topic Should I Close My Unused Accounts? in Credit Cards

Should I Close My Unused Accounts?

Anonymous — Thu, 21 Jul 2011 07:45:08 GMT

Thank you for visiting! Here is a quick run through of my credit history.

I have 11 cards (HORRIBLE, I know).

My question is, does it fear lenders that I have that many open accounts? Do they really care?

If so, should I consider closing some?

I applied for Discover and the gentlemen at recon. department told me to call back once my credit report shows my balances paid off (which they are now) so they can open an account with me.

I would just like my foot in the door with some prime cards so I don't bother with stupid First Premiere, Orchard, and all those loser ones, am I making the right choice of considering closing them?

Some insight would be great!

American Express Zync - No Preset - 4 months.

Bank of America - Secured $300 - 4 months

Bloomingales - $300 - 1 year (Considering Closing?)

Capital One - $750 1 Year

Capital One - $500 4 months (Closing?)

Citi - $1,300 2 years

First Premier Bank - $350 1.5 years (Closing?)

Hooters - $500 6 months

Nordstrom - $2,500 1.5 years

Orchard Bank - $420 1.5 years (Closing?)

Wal*Mart - $500 4 Months (Closing?)

Wells Fargo - $700 4 Months

Thank you again!

Re: Should I Close My Unused Accounts?

llecs — Thu, 21 Jul 2011 10:18:22 GMT

Be sure to read Closing Credit Cards

If there's no fee to keep it open, I'd leave them open and use them 2-3-4 times a year to keep them active.

ETA...I have 15 open and active CCs.

Re: Should I Close My Unused Accounts?

smc733 — Thu, 21 Jul 2011 12:38:36 GMT

I'm a fan of housekeeping and a tidy wallet with only good cards, even if it slightly bites the FICO 10 years from now. I'd get rid of all the ones you have makred to close, plus the Hooters card. Otherwise, the other ones look good.

I'd personally go with that plan.

Re: Should I Close My Unused Accounts?

kjm79 — Thu, 21 Jul 2011 20:55:29 GMT

You have 6 cc's that are 1 year or older. And you're considering closing 3 of those? In the short term it won't hurt your AAoA, but closing your oldest cards with such fresh new cards (and addint another new card) isn't going to help your AAoA in the long run. As previously posted, if it's got an AF, keep it until the fee comes due, call to cancel (keep if they waive the fee).

If you're concerned about managing to many cards, you can always sock drawer it (or even cut them up) but keep them open. CCC's can take some time before closing an account due to inactivity, but it's not hurting you at all to keep it open in the meantime. Closing the cards also lowers your available credit and you have to watch more closely what you allow to report on the rest of the cards. With such a short account history (with CC's at least), closing your oldest cards just seems like a bad move. Let them age a bit more and then close them.

Re: Should I Close My Unused Accounts?

DI — Thu, 21 Jul 2011 20:59:34 GMT

If the cards not in use set them loose!

Re: Should I Close My Unused Accounts?

Anonymous — Thu, 21 Jul 2011 21:26:22 GMT

If you do decide to close cards, my vote is to do it one step at a time. You'll probably want to monitor them to be sure all's closed and paid off neatly. Especially the FP if they have monthly fees.

Keep the Walmart open if you want free access to your FICO TU scores - that's a new service and you might want to keep it.

If the FP has monthly charges in addition to the annual fee, you may want to close it quickly. You've grown past needing them.

You have a lot of new accounts and a lot of new apps - I can see why you're wanting to simplify things a little. Do keep track of your AAofA and consider letting up on the app button and let things settle down a bit. Then when you do app, you'll be looking better to your potential issuer with a little more age and fewer new accounts open - that can result in higher CL's and/or lower APRs.

And in answer to your question, yes FICO does watch how many open bank/national CC accounts you have (it appears that store cards are not included in this count). It's FICO code #4 "Too many bank or national revolving accounts). These accounts do not need to have balances to impact scores. I have to say that you'll very rarely see anyone bring up this FICO code from their myfico reports. One poster did get this code with 6 such accounts, and one of his creditors closed his CC account based on that information. But that was a while back when CC issuers were pretty darn testy.

Re: Should I Close My Unused Accounts?

Anonymous — Thu, 21 Jul 2011 22:41:59 GMT

Thanks again for everyones reply, I REALLY appreciate it!

Orchard is the only one who charges me an AF.

First Premiere does charge me as well, but when I go to cancel it, they waive the AF fee. Though I do think I pay a $7 monthly fee?

Bloomingdales (Macys) does NOT report my credit limit, so would that really matter?

Most of the cards I want to close do generally charge an annual fee, but my fear was losing that AAoA, should I just keep them open but use them 1-3 times a year to keep them active, and once I get my prime cards, to just close the others out?

Thanks again!

Re: Should I Close My Unused Accounts?

kjm79 — Thu, 21 Jul 2011 22:50:07 GMT

@Anonymous wrote:
Thanks again for everyones reply, I REALLY appreciate it!

Orchard is the only one who charges me an AF.

First Premiere does charge me as well, but when I go to cancel it, they waive the AF fee. Though I do think I pay a $7 monthly fee?

Bloomingdales (Macys) does NOT report my credit limit, so would that really matter?

Most of the cards I want to close do generally charge an annual fee, but my fear was losing that AAoA, should I just keep them open but use them 1-3 times a year to keep them active, and once I get my prime cards, to just close the others out?

Thanks again!

You can close those cards and you won't see an immediate impact on your AAoA. It will stay the same as long you DO NOT open any new accounts. Closing the account doesn't erase the account's history. The account will stay on your reports and continue to factor into your AAoA for 10+ years from the date you closed the account. I only stress that if you close these accounts, you shouldn't app for more credit as that will lower your already low AAoA.

If the bloomingdales doesn't report the limit, it won't factor into your UTIL so don't worry about that card. I haven't used my Macy's card in 6 months because of how they have been running their purchase procedure....still open...still reporting. You don't necessarily have to use the cards you are considering closing, they'll stay open for a bit before they are closed due to any inactivity. But just know that closing them tomorrow won't lower your AAoA as long as you wait before apping for any new credit. Let the history age before you try for a new card.

Re: Should I Close My Unused Accounts?

Anonymous — Thu, 21 Jul 2011 23:19:39 GMT

@Anonymous wrote:
Thanks again for everyones reply, I REALLY appreciate it!

Orchard is the only one who charges me an AF.

First Premiere does charge me as well, but when I go to cancel it, they waive the AF fee. Though I do think I pay a $7 monthly fee?

Bloomingdales (Macys) does NOT report my credit limit, so would that really matter?

Most of the cards I want to close do generally charge an annual fee, but my fear was losing that AAoA, should I just keep them open but use them 1-3 times a year to keep them active, and once I get my prime cards, to just close the others out?

Thanks again!

What is wrong with 11 cards. I don't think that is high.

I would close the First PRemiere, $7 a month is still very high for that card.

I would consider keeping Orchard if the AF is not too high or you can get them to waive it. They are being sold and you may end up with a better bank (might not). I'd wait and see.

I don't see any reason to close any others.

Re: Should I Close My Unused Accounts?

Anonymous — Thu, 21 Jul 2011 23:25:42 GMT

Orchard is a hefty $79 a year for their annual fee. I tried to waive the fee and it was a no-go. Not sure if I did something wrong?

I always thought that 11 might seem too much in general, but insight if open revolving accounts make a huge difference.

Re: Should I Close My Unused Accounts?

CreditScoreFail — Fri, 22 Jul 2011 00:22:39 GMT

Are you kidding me? I'll take the Bloomingdale's and the Nordstrom, please.

I'd do anything for a dept. store CC approval.

Re: Should I Close My Unused Accounts?

Anonymous — Fri, 22 Jul 2011 18:08:09 GMT

Haha, I plan on keeping the Nordstrom, I love the lines they carry. But not so much of Bloomingdales, I would prefer to keep Nordstrom with either Neiman Marcus and/or Saks.

Re: Should I Close My Unused Accounts?

haulingthescoreup — Fri, 22 Jul 2011 18:20:33 GMT

@Anonymous wrote:
Thank you for visiting! Here is a quick run through of my credit history.

I have 11 cards (HORRIBLE, I know).

My question is, does it fear lenders that I have that many open accounts? Do they really care?

If so, should I consider closing some?

I applied for Discover and the gentlemen at recon. department told me to call back once my credit report shows my balances paid off (which they are now) so they can open an account with me.

I would just like my foot in the door with some prime cards so I don't bother with stupid First Premiere, Orchard, and all those loser ones, am I making the right choice of considering closing them?

Some insight would be great!

American Express Zync - No Preset - 4 months.
Bank of America - Secured $300 - 4 months
Bloomingales - $300 - 1 year (Considering Closing?)
Capital One - $750 1 Year
Capital One - $500 4 months (Closing?)
Citi - $1,300 2 years
First Premier Bank - $350 1.5 years (Closing?)
Hooters - $500 6 months
Nordstrom - $2,500 1.5 years
Orchard Bank - $420 1.5 years (Closing?)
Wal*Mart - $500 4 Months (Closing?)
Wells Fargo - $700 4 Months

Thank you again!

For some folks, 11 cards is like a starting level, while for others, it's a nightmare.

As long as you keep aware of the long-term implications of closing cards, it's completely up to your own comfort level.

I'd definitely close any fee cards that aren't giving awesome rewards.

I can see closing the Bloomie's with the training-pants $300 CL, or especially if they're doing the same as Macy's and not even assigning a CL any more. Otherwise, I think we've figured out that having a store card doesn't do anything special for your credit (although if all you have is store cards, having a bank card definitely would help.)

The younger the card, the more sense it might make to close it. It's going to affect your AAoA as long as it's on your reports (generally 10 years after closing), but once it falls off, your AAoA might actually increase, depending on what had happened in the meantime.

In the end, I'd say get to where your cards don't make you crazy. They're just tools, so you should be able to regard them as there for your convenience, rather than as a slavering pack of wild animals needing constant attention.

If you haven't already, read fused's "Closing Credit Cards" linked below in my siggy.

edit: cna't splel

Re: Should I Close My Unused Accounts?

DI — Fri, 22 Jul 2011 19:36:28 GMT

We put too much emphasis on whether or not we should close an account. If someone currently have an account that is 10 years old(given the fact that a closed account reports 10 additional years), and they open an account today that account will be 10 years old by the time the old account is deleted.

I don't understand what's the big deal. The only reason I see one may be cautious about closing accounts is because they may want to continue apping for new cards for the next 10 years. At some point, whether someone's AAoAs is 6 years or 15 years, I don't see any additional points being gained due to the age of accounts. There's a cut off point somewhere. I wish Mr. Barry can tell us. JMO

Re: Should I Close My Unused Accounts?

Anonymous — Tue, 26 Jul 2011 16:24:53 GMT

Pay Orchard off and call them right before the fee is due. Ask to waive the fee or you'll close it. They'll definitely waive it. I've had no issues with them doing that. The only reason I even still have that one open is because it's not hurting me really to keep it open. The low CLI just blows.