Subprime cards should I close them, or not?

[Anonymous]

If I have a few sub-prime cards that have served their puopose, should I leave them open or close them?

I have 2 fp cards that total up to 625.00, and a plains commerce cc with a cl of 370.00 but now I am being approved for bigger credit limits with better cards, so after having those dreadful cards for more than 2 years, should I let them stay open or should I close them?

I guess my real question is will I lose pts for closing them, or would I benefit more if let them continue to report as an open acct.  My average age of credit is not much since I am so young, but the cards are in good standing all with reporting balances 0 util. 

Any help is greatly appreciated..............

[Anonymous]

Closing cc is most of the time a bad idea because of average age of accounts. The old positive ones if closed will still report & factor into the age for the next 10 years after closed. Have you tried calling those companies to see if they can switch your account to a prime card using the same open dates? That would be great & a lot of times they will upgrade you. If not , it could depend on how soon you are wanting to make a major purchase. If you want to buy a house soon, you wouldnt want a lot of new accounts opened up. If you do close & open new new ones do you have a mother or father or husband that can add you as an authorized user to an account that is in good standing , with a low balance & really old age to help counter the effects of your low age?

[haulingthescoreup]

Just to note: all accounts, not just positive ones, are factored in to AAoA, and longest history.

If there are negatives on a closed account, they will stay on reports for seven years (generally), and then fall off. The accounts themselves report for ten years after closing, and then fall off.

So a negative account will have at least 3 clean years of reporting towards the end. Many people get angry (with themselves) after a late or other negative posts, and they close the account. If you can grit your teeth and keep it open for a while, that's more clean history that will report after you do finally close it.

An example: you have a 30-day late in March 2009. If you close it that month, the negative will report until March 2016, and the account itself will report until March 2019, with the last three years reporting as clean after the late fell off.

Alternatively, you kept the card open until March 2011. In this case, the late will only report until March 2016 and then fall off, and the closed account will then report clean for 5 years until March 2021.

Somehow the idea has gotten going that accounts with negatives fall off when the negative falls off, but that's not correct. And during this time, they are contributing to your history. hth

[Anonymous]

So we are absolutely sure about this, that the baddies don't completely fall off after 7 years, but rather only the negative aspects (late payments, negative commentary, etc.) "fall off" and the TL reports clean for the final 3 years?

Isn't there a good chance that for some items on some CR's the entire TL will fall off after 7 years and you don't get the clean 3 afterwards?  How much evidence of this do we have from those with such experiences?

[haulingthescoreup]

An Experian CSR told me this about a 30-day late on a closed gas card. It hit the month we closed it. (Statements kept being taken from our mailbox; this was back in the day.)

On my full EX report, which I don't have handy, it says that the status will revert to clean (dang, I wish I could access it here and have the proper terms) in MM/YYYY, and that the card will report until 3 years after that, which would be ten years after closing.

And I checked with Barry, who confirmed this.

Now, I was asking him about plain old lates. It's entirely possible that with something more complex, where the status of the account is different, the whole thing will go away. But for an otherwise clean account with lates on it, there's no reason to assume that the entire account is somehow corrupted and treated differently.

Sorry if that created any confusion.

And if any of us are still alive when my lates start falling off, I'll be sure to update back here as to whether the account is still there.

[Anonymous]

Thanks Hauling.   I will be sure to report my findings too, but I don't have any coming off until 2014......

[haulingthescoreup]

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Boscoe wrote:
Thanks Hauling.   I will be sure to report my findings too, but I don't have any coming off until 2014......

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Well, pull up your wheelchair next to mine, lol, and we'll compare reports!

[Anonymous]

My scores are not where yours are yet (680/703/693, EQ/TU/EX), but hope to get a bump at 2 year from BK (July 09) and hover in the low 700's for the next few years until the baddies start falling off.

No wheelchair for me yet.....not until I am over 800!

[valley_man0505]

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@haulingthescoreup wrote:
Just to note: all accounts, not just positive ones, are factored in to AAoA, and longest history.

If there are negatives on a closed account, they will stay on reports for seven years (generally), and then fall off. The accounts themselves report for ten years after closing, and then fall off.

So a negative account will have at least 3 clean years of reporting towards the end. Many people get angry (with themselves) after a late or other negative posts, and they close the account. If you can grit your teeth and keep it open for a while, that's more clean history that will report after you do finally close it.

An example: you have a 30-day late in March 2009. If you close it that month, the negative will report until March 2016, and the account itself will report until March 2019, with the last three years reporting as clean after the late fell off.

Alternatively, you kept the card open until March 2011. In this case, the late will only report until March 2016 and then fall off, and the closed account will then report clean for 5 years until March 2021.

Somehow the idea has gotten going that accounts with negatives fall off when the negative falls off, but that's not correct. And during this time, they are contributing to your history. hth

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HTSU--are you only talking about accounts that are closed by the consumer when you say that only the negatives drop at the 7 year mark and not the entire account?  I believe the entire account drops at 7 years if it was a derogatory account closed by the CREDITOR.  I may be wrong as I don't have first hand experience since my derogs are still about 6-12 months from reaching that point.  However, from other posts, it seems that CO's and collections and things of that nature tend to disappear entirely (obviously collections would since there is no such thing as "positive history" with a collection account).

ETA:  I guess you more or less answered my question in the follow-up post after your initial post.

Message Edited by valley_man0505 on 03-23-2009 08:35 AM

[haulingthescoreup]

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valley_man0505 wrote:

However, from other posts, it seems that CO's and collections and things of that nature tend to disappear entirely (obviously collections would since there is no such thing as "positive history" with a collection account).

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In fact, this is what my brain was scrambling for, and you expressed it much more clearly. It's the original accounts that keep going. CO's and collections are separate beasts.