To Cancel or not to Cancel? That is the question.

[meloman68]

Hello Community!
My wife and I are contemplating cancelling our CreditOne cards. We each have our own. We currently have 3 other cards on joint accounts with Navy Federal, Bank of America, and Barclays AA Aviator Red.  Total available credit across all cards is $24,900. For her, the utilization is sitting at 40% Equifax, Trans, and Exp. For me it is 47% Equifax, 50% Trans, and 47% Exp.  The CreditOne cards limits are $1100 for each of us. The CreditOne cards have the longest history at just over 2 years.  The others are under 1 year. 

Based on my caculations, if we cancel the CreditOne cards, the utilization scores will increase by a couple percentage points.  We are sick of paying the monthly fees of $8.13 on each of the CreditOne cards .  We do not use the cards anymore since we got the other cards.  If I could get them to cancel the fees, we would just keep them.  Should we cancel them now or wait until we've paid down some balances to get the utilization percentages down first? As usual, any feedback is greatly appreciated!

[NRB525]

I would close the Credit One accounts. Redirect that $8 per month to paying down balances. Simplify your life by not having to worry where their next fee will come from.

As you pay down the balances, are the cards with balances not used for regular charges? You should not add new charges to cards you are trying to pay down.

If possible ensure one card is in PIF mode to avoid interest charges on the new purchases for that card.

[meloman68]

Hi,
Thanks for the quick response!  Regarding the other cards, the plan is to pay 2 of them completely down, and use the other card for bills to accumulate points/miles.  So, the balance will be paid off monthly.  What is PIF mode?

[Adkins]

---

@meloman68 wrote:

Hi,
Thanks for the quick response!  Regarding the other cards, the plan is to pay 2 of them completely down, and use the other card for bills to accumulate points/miles.  So, the balance will be paid off monthly.  What is PIF mode?

---

PIF - Pay In Full. Paying the entire balance due so no interest accumulates. 

[AverageJoe1970]

I think keep the crappy cards just because building the AAofA is so important - and work as best you can to pay down your cards to get your overall utilization down. Once you get your utilization down below 20%, then consider getting a better card. Its not fun paying some lame monthly fee, but it might work in your favor down the road.

I have a super old Capital One card with a $700 CL (no fees)... solely because of its age. I haven't used it in over 3 years, and Capital One won't raise the limit because I don't use the card. (Pretty comical since my credit score is over 800, but it is what it is.)

GOOD LUCK!

[meloman68]

Got it, thanks!

[imaximous]

Regarding the comment about AAoA above, closed cards will stay on your reports for about 10 yrs, so that will have no effect on your AAoA.
I'd close both CreditOne cards and stop paying those fees. That's $16 a month you're saving towards something else -- paying down your other balances. The limits on those cards are too low to be worried about utilization and pay fees.
Your utilization may take a tiny hit at first, but you'll save money. You're basically paying $16 to lower your utilization by a tiny margin. Not worth it, IMO.
Besides, scores and UTIL only matter if you're looking to obtain new credit. If you're not planning to make any moves, then it doesn't matter what it is right now. Just focus on lowering those balances, and you'll feel much better about not having a bunch of debt weighing you down. Get rid of those cards.

[Anonymous]

Get rid of CreditOne, don't even think twice about it.

Your AAoA will grow in time and old accounts stay on for up to 10 years.

[meloman68]

Thank you for the feedback.  I agree, I'm sure we'll feel much better once they're gone. We don't plan on making any major moves any time soon.

[meloman68]

Thank you!