topic Re: Closing cards in General Credit Topics

Closing cards

Anonymous — Sun, 12 May 2019 00:00:03 GMT

I just read a thread about cards being auto closed due to inactivity. I have two cards (both synchrony home) that I do not plan on using in the near future and they’ll probably close before I need to use them anyways .

An app I use has a credit score simulator and if I tell it that I’m closing either cards, it projects at least a 10 point boost in my score. How accurate are these simulators? As I said, I won’t need these cards before they’ll close anyways, but I don’t want to negatively hurt my score now if I can help it.

Re: Closing cards

VanderSnoot — Sun, 12 May 2019 00:13:40 GMT

Re: Closing cards

Anonymous — Sun, 12 May 2019 00:37:56 GMT

Simulators are not accurate. They run on generalizations but don’t have access to the particulars of your profile like AAoA, AoYA, AoOA, utilization percentages inquiries, derogs, etc. There is no way for them to accurately predict the effects of change on a profile when they don’t account for the particulars of said profile. Pay them no mind.

To get a feel for what happens, figure out your UTI with and without the limits of those cards included, and try to figure out the changes in the age-related factors. That’ll give more of an idea as to what effect their closure will have.

Re: Closing cards

Anonymous — Sun, 12 May 2019 00:43:20 GMT

AAOA will increase, as they’ve all been open at most of 2 years. AOYA will remain the same as none of them are my newest accounts.

UTI would increase as I’d be taking out about 9k of credit out of total credit

Re: Closing cards

Anonymous — Sun, 12 May 2019 03:50:33 GMT

@Anonymous wrote:
AAOA will increase, as they’ve all been open at most of 2 years. AOYA will remain the same as none of them are my newest accounts.

UTI would increase as I’d be taking out about 9k of credit out of total credit

As far as FICO is concerned, your AAoA will not increase with the closing of an account. Your AAoA will change when you get a new account and it hits your reports or you have an old one that falls off your reports which is typically 10 years. Accounts open AND closed make up your AAoA.

Simulators are garbage. Let's take my recent Chase simulator. If I added a foreclosure and failed to pay child support, my score would increase. Sounds logical doesn't it?

Losing 9k can affect your UTI however there may or may not be score loss associated with it. It really depends on your individual limits, total limits, and how much you are letting report.

Re: Closing cards

Anonymous — Sun, 12 May 2019 16:52:57 GMT

Over the last three years I closed eight cards and dropped about $90K in credit limits. There was a very minor reduction in my credit scores which came back quickly. Got tired of trying to keep so many credit cards busy when I did not really have the spend and was using some of them when I did not have a real need (store cards particularily) to spend. Also, Citi Bank and US Bank said I had too much available credit for my income so I took the guidance and worked at right sizing my credit profile. Considering the closure of some more bank cards as the spend just isn't there and I don't want to manufacture spending to spend. My attitude today is, if the money isn't in the bank I don't spend.

Re: Closing cards

SouthJamaica — Sun, 12 May 2019 14:05:58 GMT

@Anonymous wrote:
I just read a thread about cards being auto closed due to inactivity. I have two cards (both synchrony home) that I do not plan on using in the near future and they’ll probably close before I need to use them anyways .

An app I use has a credit score simulator and if I tell it that I’m closing either cards, it projects at least a 10 point boost in my score. How accurate are these simulators? As I said, I won’t need these cards before they’ll close anyways, but I don’t want to negatively hurt my score now if I can help it.

1. The simulator is entirely unreliable.

2. It is unlikely that closing the cards will make any difference in your score either way, unless losing the limits significantly affects your (a) utilization percentages or (b) percentage of accounts reporting a balance.

Re: Closing cards

pinkandgrey — Sun, 12 May 2019 14:49:38 GMT

Don’t rely on simulators. To be blunt, they’re worthless. However, I completely support the idea of closing them yourself. I just closed a bunch of cards myself. If I don’t use it, I don’t want it. CLOSE CLOSE CLOSE! Your score will be fine.

Re: Closing cards

Anonymous — Sun, 12 May 2019 15:29:35 GMT

Should I space out closing them or do it all at once ?

Re: Closing cards

Revelate — Sun, 12 May 2019 22:05:45 GMT

Closing credit cards is not a credit decision: closing one will never help one's credit scores (talking FICO), on the flipside it won't hurt either except for utilization metric changes and that can be managed other ways.

If you decide to close them, can just dump them all at once: it doesn't matter and actually I'd suggest it'd look better on the credit report anyway.