No simulation for closing an inactive/unused credit card

[Anonymous]

I have an Amex credit card that charges me $55 per year for the 'privilege' of having it.  I don't want to pay that $55 per year each year and ideally want to close the card/account.  However, I've had the card for 29 years and I fear that if I do close it then it will negatively affect my FICO score.  I haven't used the card in about a year.

How is there any way to determine if it will affect my score and by how much?

They have all these FICO score simulators but none dealing with how scores would be affected by actually closing an used credit card account opened for so long.

Thought?

Thanks.

forthill

[Anonymous]

May want to just maybe do a product change and trade up to a card without a AF. I would call AMEX and ask if this can be done.

[haulingthescoreup]

Hi, forthill, welcome to the forums!

I doubt that there will be any immediate impact on your scores, because AmEx charge cards aren't included in factoring your overall util (total amount owed divided by total credit limit.) However, this is a very old card, and if you close it, you will lose its history when it stops reporting. It should report for 10 years, but this doesn't always happen.

I have a closed 20-year-old gas card, and it will stop reporting in 3 years, and I'll be pretty sad when that happens!

If this were a standard credit card, and if it had a decent credit limit, and if you carried balances on other cards, closing it could hurt your scores by lowering your total credit limit. This would make your util go up.

In general, closing a CC doesn't help your score in any way. It does make sense if you don't want to pay fees. If you haven't already, please read this sticky by fused:

http://ficoforums.myfico.com/fico/board/message?board.id=creditcard&thread.id=16915

[Anonymous]

I agree with so_confused  about a product change.

However- AMEX is known to waive AF's for it's longstanding customers-  just call and ask.

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so_confused wrote:

May want to just maybe do a product change and trade up to a card without a AF. I would call AMEX and ask if this can be done.

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[haulingthescoreup]

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@Anonymous wrote:

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@Anonymous wrote:

May want to just maybe do a product change and trade up to a card without a AF. I would call AMEX and ask if this can be done.

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I agree with so_confused about a product change.

However- AMEX is known to waive AF's for it's longstanding customers- just call and ask.

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Didn't think that you could swap between a charge and a credit card with them?

[Anonymous]

Thanks Hauling....

I know that closing a card won't help my score - I just didn't want it to hurt my score.

I did open another card with Amex (Blue Cash) last year.

Your point about the Amex green card is that it is not a true credit card like a Mastercard?

By the way, I NEVER carry balanaces on any of my cards  - never had and most likely never will.  My score is just under 800 because of my mortgage and car lease.  *Actually, they say that the total owed on my revolving accounts is too high, which also makes my ratio to credit limit high at 18%.  There's not much I can do about that other than paying off my mortgage (gag!) and not leasing my car any more.

forthill

Message Edited by forthill on 03-19-2008 07:47 AM

[haulingthescoreup]

Sorry, I was a bit befuddled when I posted above --trying to carry on a conversation with a college-age daughter while tappity-tapping away.

What I was trying to say is that closing it won't hurt you now, but depending on the age of your other cards, and depending on when AmEx stops reporting it (should be for 10 years after closing, but that doesn't always happen), you could be hurt when you eventually lose the history.

And if it were a credit card, and its credit limit were included in your overall credit limit, it could potentially hurt on closing by reducing the amount of available credit. But since it's a charge card, it should be showing up in that "other" category and not factored in your overall util.

So short term, it shouldn't hurt; long-term, it might, depending on any other old accounts you have.

If you used it a lot, I'd say ask for a fee waiver, but since you don't use it much, I don't know if they'd be willing. Alternatively, you should be able to open a non-fee AmEx card and the history on the green would transfer over, * I think. *

[Anonymous]

I have no experience with AMEX, but I know they give all of your cards the same 'member since' date.  So would his second AMEX card show up on his CR as being 29 years old also?  In this case I think he could close the first card and not lose the age of oldest account........

[Anonymous]

That is the question, rebuilder.  And thanks for the clarification Haulage.

When I applied for the Blue Cash card a y ear ago they did say my 'member since' date would match my 1979 date from my green card.  The Blue Cash cards don't emboss this date like the green cards so I can't tell just by looking at it.  I need to contact Amex to ask what is in their system.  However, I have my doubts if they'd be able to tell me if it shows on my CR as 29 years old.  I'd have to pull my credit report to see that I guess.

forthill

[Anonymous]

haulingthescoreup....

According to my Equifax credit report they consider (or list) the Amex green card as a 'credit' card, not as a 'charge' card.  Although, perhaps they do not have any other category than a 'credit' category?

forthill