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Closing credit card question

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Anonymous
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Closing credit card question

If I have a few high interest rate, small CL cards that charge an annual fee (and 1 charges it monthly) and they are less than a year old - will it hurt my score that much to pay them off and close them? I ask because everybody says leave them open but I don't want them and don't want to pay a monthly fee at least on that one to just leave it open - but I want to apply for a mortgage in the near future so????
Message 1 of 4
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Anonymous
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Re: Closing credit card question

What other cards do you have?
 
What kind of util do you have? What will your util be after these cards are closed?
Message 2 of 4
Anonymous
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Re: Closing credit card question

The accounts I'd be closing would be
capital one - 500 CL 16.15% int. rate. (yearly fee)
Credit one - 650 CL 23.99% int. rate (and a yearly fee billed monthly)
Household - 750 CL 26.99% int. rate (can't remember right now if there is a yrly fee)
 
All opened within the last year.
 
That would leave me with:
GEMB/Care Credit - 500 CL - 0 bal.
GEMB/CARE Credit - 500 CL - 0 bal.
Both opened within the last year, higher int. rate (21.99%) but no annual fee and:
 
Capital one - 1250 CL - 15.99% int. rate (yearly fee but open a couple of years) - bal 1100
Target - 1000 CL - 18.99% int. rate (no yearly fee & open for 9 years) - bal 800
AAFES Military Star Account - 4500 CL (9.99% int. rate -no annual fees) - bal 1840
 
So, high util on the remaining but I'd pay those down and eventually close cap 1 and maybe target for better interest rate cards later. 
 
I'm interested in the short-term (very short-term scenario like end of this month or next month) the first 3 cards I listed - pay off close.  At the very least, it it is about util.I should consider vs. overall avail. credit leave those open while I paid the others down then get the mortage and close them I don't care after that but this one that has a monthly fee that is just crap to keep paying that after I pay it off but I don't want to lose points - trying to gain points for a mortgage.
 
Sorry this is long and confusing.
 
Message 3 of 4
Anonymous
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Re: Closing credit card question

Never mind...I think that answers my question.  Looking at util. I'd be at 39% with them open and 41% with them closed.  If I paid the remaining ones off to at least under 50% to begin with while paying the others off AND leave them open I'd be at closer to 29% and with them closed 32%.   So, I guess I will have to bite it and keep them open until I get mortgage approval but then I'm closing those crappy things and getting better int. rate cards, etc. 
 
I have been reading on the boards just recently and see all the ways to manipulate the numbers by having all these cards with very little used, etc. and I just don't have time for that right now because I feel like everything should be in a hold pattern and just paying things down and off to get my mortgage...then I'll worry about getting better int. rates cards, etc.  (just because wouldn't it be worse for me in the short run to open a bunch of new accounts when I want my score to go up?? and not down - or maybe I have it wrong and instead of worrying about just paying off, open more, but then won't it go against me because the accounts would not be aged?)  My God this is madness I don't know how you guys do it (yet I feel like how can't I?) if this is what it takes to have "good" credit.  I'll be 2 years getting into a house if I start moving balances and opening new lines, etc..  I realize there are no quick fixes but this is ridiculous.  I was told by my broker that paying down my balances would increase my score (hopefully) enough to get approved.  I sure hope he is right.
Message 4 of 4
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