Good idea or not: closing a card due to cancellation of order.

[Anonymous]

Hi there,

Brief summary: I ordered a couch from a furniture store and applied for financing on it. I didn't know at the time (I was simply told they needed a credit check) that they'd be opening a card for me with a $6k limit. The next day, the store called and said the couch turned out to be discontinued, and that they could either cancel the order or help me find a new one. I chose to cancel the order, but the card of course stayed open. The charge got refunded so the card's balance is 0, but the question now is whether it would be harmful or not to close the card. I'd rather close it, simply because it's not something I chose to open and I'd rather make those decisions consciously. FWIW, if you exclude my student loans, my two other credit cards do not together total $6k.

Thanks!

[pizzadude]

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@Anonymous wrote:

Hi there,

Brief summary: I ordered a couch from a furniture store and applied for financing on it. I didn't know at the time (I was simply told they needed a credit check) that they'd be opening a card for me with a $6k limit. The next day, the store called and said the couch turned out to be discontinued, and that they could either cancel the order or help me find a new one. I chose to cancel the order, but the card of course stayed open. The charge got refunded so the card's balance is 0, but the question now is whether it would be harmful or not to close the card. I'd rather close it, simply because it's not something I chose to open and I'd rather make those decisions consciously. FWIW, if you exclude my student loans, my two other credit cards do not together total $6k.

Thanks!

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I'm assuming that this is showing on your credit reports as a revolving account, is that correct ?    If so then the only negative effect on your FICO score would be if you are letting balances report and your revolving utilization increased as a result of losing the $6K credit line.

I'll move this to the Credit Cards forum ~ also here's a good link on the effects of closing credit cards:     http://ficoforums.myfico.com/t5/Credit-Cards/Closing-Credit-Cards/td-p/347190

[djc1puno]

+1

[Creditaddict]

if your other 2 credit cards combined don't equal this $6k credit line... sounds like really what you need to do is call your current 2 credit lines and tell them you want an increase or you will find new credit cards that will meet your standard of credit score

I assume this furniture card is backed by GE?

Who are your current 2 credit cards with and limits if you don't mind?

If you only care about your original question, I would personallly leave it open... most likely it could sit some time inactive, maybe even over a year and you never know if you might decide on some other type of furniture in that time.... not to mention if you do decide to get some flashy new credit cards... this furniture card will help!!

check for yourself over at citicards.com or chase.com and see if you have any pre-qual offers come up for something useful for yourself that's better then what you have.

[Anonymous]

@creditaddict But if I don't need that amount of credit, should I still try to get it? And yes, it's a GE card. I thought inactive cards were bad for your credit? Also, does having the credit card already open mean that I will be able to get things financed on it? I thought I could only get things financed when opening a new card with a purchase. My current lines are Capital One for $1500 and Barclays Card for $2500. The former I picked up when I was 18 to start building credit and the latter I picked up with my Macbook Pro financing deal.

[Anonymous]

I don't know if it's showing yet. The card was only opened last week, so if I closed it now would it appear as though it never really existed?

[pizzadude]

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@Anonymous wrote:

I don't know if it's showing yet. The card was only opened last week, so if I closed it now would it appear as though it never really existed?

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It will show up on your credit reports regardless of whether you close or choose to leave it open.

[marty56]

If the account is with GE, I would leave it be.  GE is a great company to work with as long as you don;t cross them and PIF the balance before the interest fee period if that is offered.  They can be generous with limits an while I was in DMP, they didn't dump me like everyone else did.

In general I would never close a revolving account even with a company I don't intend to ever do business with again, unless they are charging a monthly fee or a high yearly fee.  If I had say a 30 year oldrevolving account with a yearly fee of say $100, I would still keep it on my CR.

[myjourney]

Cut the card up if there's one and let it report for history down the road

Since it will show as a 6K line and help with UTL over the years....  IMHO

[Anonymous]

PIF, DMP, and UTL?