@mom22sonz wrote:I have a friend who I have been discussing credit scores with etc... He has the capital one card that gives you your score each month. He's been tooting around with their simulator to see how to boost his score. Apparently what they are indicating or what is working is paying down all cards by 500 and then closing his oldest credit card? I just wondered what your input is on that..... I heard that we shouldn't close accounts. He will be monitoring utilization etc.. on the remaining open cards and doesn't have a concern about needing the credit line from this card and I think its even a Best Buy card which he hasn't used in an age... Thanks for your insight.
Capital One card offers a score which is identical to Credit Karma's website. It is a FAKO and is not used by any lenders. So this score (and consequently the simulator) is usless and the simulator is not a good predictor of how the score will react if you do one thing or another.
With regards to closing the oldest credit card, there are a few things you need to consider..
1. How will closing this card affect your friend's utilization? Example: If your friend has 3 credit cards... All of them at 1000 limit. This brings the total available credit to $3000. Now say your friend is carrying a balance of 500 on two of the three cards. This brings your utilization to 1000/3000 available or (33%). If you close the one card that doesn't have a balance, your friend would lose 1000 of available credit. So now your utilization would be 1000/2000 or 50%. See how this impacts utilization?
With regards to the AAoA it doesn't impact your friend at all - at least not for the next 10 years after which it drops off.
Hope that helps.
