Reply
Moderator Emeritus
Posts: 5,436
Registered: ‎03-10-2007
0

Closing cards

I applied for a card and really didn't get what I wanted out of it so recently applied for a new card with a much higher limit as well as cash rewards.  My question is what effect will closing a new account have if your utililzation remains at about 15%?  I got a ding on my report for too much avail credit suggesting I close an account or lower limits. 
Administrator Emeritus
Posts: 4,444
Registered: ‎03-01-2007
0

My question is what effect will closing a new account hav...

My question is what effect will closing a new account have if your utililzation remains at about 15%?  I got a ding on my report for too much avail credit suggesting I close an account or lower limits. 
 
As you probably know, Brammy, the main reason why you don't want to close an account is because by closing it you reduce your available credit, which can then increase your utilization percentage.  So, if you're saying that your revolving utilization is about 15% regardless of whether this new account open or closed, then there shouldn't be any negative impact to your score from closing it.  Are you closing the new account to avoid further fees?
 
And I'm curious about your comment about getting dinged for too much available credit.  Is that what one of the negative reason codes you received with your score said?

Formerly consumer affairs manager, media spokesman and myFICO Forums community manager at FICO, I'm now freelance writing for CreditCards.com and my own site, SpeakingOfCredit.com.

Moderator Emeritus
Posts: 5,436
Registered: ‎03-10-2007
0

Believe it or not the message I got under negative reason...

[ Edited ]
Believe it or not the message I got under negative reasons was 'Too much avail credit will make lenders nervous, consider closing some accounts or asking that your limits be lowered'
 
Utilization would be at 15% if I closed it since it is the lowest limit major I have right now I'm somewhere around 12.  I called to close and they talked me out of it by doubleing the limit.  Just what I neededSmiley Tongue
 
Now Barry one to those other questions I posed and I have another doozy brewing.  I need FICO Guru helpSmiley Very Happy


Message Edited by Brammy on 03-15-2007 05:38 PM
Administrator Emeritus
Posts: 4,444
Registered: ‎03-01-2007
0

Believe it or not the message I got under negative reason...

Believe it or not the message I got under negative reasons was 'Too much avail credit will make lenders nervous, consider closing some accounts or asking that your limits be lowered'
 
That doesn't sound like a FICO scoring negative reason since the scoring formula doesn't consider 'too much available credit' to be an indication of increased risk.  In fact, there is no such thing as too much available credit in the eyes of the FICO formula.  (Although that doesn't mean it's a good idea to open a bunch of new accounts to increase this availability.)  I take it this was a non-FICO credit score you received this negative reason on?

Formerly consumer affairs manager, media spokesman and myFICO Forums community manager at FICO, I'm now freelance writing for CreditCards.com and my own site, SpeakingOfCredit.com.

Moderator Emeritus
Posts: 5,436
Registered: ‎03-10-2007
0

Yes this is a FICO model supposedly tied to scorewatch....

Yes this is a FICO model supposedly tied to scorewatch.   It says too many cards with a balance since I rotate which cards I use, a few bucks reporting on each card this mo. (50 here, 60 there)  Then goes on to give that line about lowering limits or closing cards due to too much avail credit. 
Regular Contributor
Posts: 169
Registered: ‎03-16-2007
0

Pay the cards those few bucks before they report (typical...

Pay the cards those few bucks before they report (typically the end of statement balance, although easy enough to figure out). You'll still keep the cards active but you won't have the too many cards with a balance issue.
Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
† Credit cards for FICO Score ranges: The score ranges are guidelines based on actual applicant approvals and having a FICO Score in a particular range does not guarantee you will be approved for credit cards recommended in that range.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.