What should I do with unused AMEX CM card?

[Anonymous]

I have an unused AMEX CM card with a $12K SL (I replaced it with the higher-CB PPMC for non-category spend). This limit represents about 30% of my overall card SL. I only carry a small balance of up to $300 per month on one card (a BCP) for scoring puposes. All my other cards are PIF before posting, so utilization is not an issue.

My only credit-related goal at this time is to try to maintain my scores and overall credit profile to get the best rate on a lease (loan) in June or July of 2021 (a year from now). My income is somewhat low, but steady. I don't pre-qualify for any new cards that excite me, despite having a totally clean file and decent scores (FICO 8 TU/EX/EQ 786/785/769) . I believe it's because I've peaked with my SL relative to my income. I'm concerned that this overall SL peak may affect me getting a good lease/loan deal.

At first I thought I should cancel the card. But then I thought that maybe in the future a different AMEX card may interest me and I could do a product change. I also would like to keep my AAoA as good as possible. I'm leaning towards asking AMEX to reduce the SL on this CM card to $1K-$2K and use it a few times a year and keep it open.

What am I missing here? Any advice is appreciated.

[Mv350]

I would keep it open for UTI padding. Since it is a no AF card, it doesn't hurt to keep it open. Although I'm pretty sure you could move the limit over to your BCP if you don't want to keep it open so you don't have to keep tabs on it. That way you don't lose the padding at all. 

A closed card will continue to report for up to 10 years. So your AAoA won't take a hit. 

[NRB525]

I would keep it open, at this CL. 30% is a big chunk of your credit limits. What is your limit on the BCP?

Since you don't care how perfect your scores are, why not let the cards report their activity / statement balance as normal, and use autopay to let them pay  nearer the payment due date? You will be surprised how little score changes, and putting reported use on these cards can have benefits later, because of the actual visibility of your card usage to all / other lenders. 

[CreditCuriosity]

Doesn't hurt you keeping it open or as other poster said you should be able to move the CL over from CM to BC card with exception of i believe 500-1kish of it and then close out the card as well.. Closed card continue to build your AAOA for approx 10 years as well so no impact there.. The worse impact is always the initial opening of the card.

[Anonymous]

BCP limit is $5K.

I have considered what you've said regarding auto-paying. I may give that a try for the reasons you gave. I just got into the habit of AZO and it stuck.

Edit: typo

[kdm31091]

I rarely see much point in requesting a voluntary credit line decrease. If the card is useless to you, a lower limit is just going to make it even more useless because you can't even use it for a one off big purchase or anything.

It has no fee so it hurts nothing to keep it open, but I also understand wanting to simplify. I doubt you would see any large effects from closing the card so if that's the route you wanted to take I don't see an issue. Keep in mind you can move limits with Amex (with some restrictions) so you could do that before closing it if you wanted to increase your BCP.

[Anonymous]

>I don't pre-qualify for any new cards that excite me, despite having a totally clean file and decent scores (FICO 8 TU/EX/EQ 786/785/769)

Prequals not happening, even for excellent credit, is more due to the current economic crisis.

>I believe it's because I've peaked with my SL relative to my income. I'm concerned that this overall SL peak may affect me getting a good lease/loan deal.

Nah. Havinig debt is the worry, not available credit. There's still room to grow your limits if you want. Having lots of available credit is good and won't hinder you except for with some particular credit unions. You're still well below where even they would worry.

>My only credit-related goal at this time is to try to maintain my scores and overall credit profile to get the best rate on a lease (loan) in June or July of 2021 (a year from now).

Your scores listed are already there. So, you should get approved at the best rates. The rest would depend on your debt to income ratio. Just keep doing what you're doing and you should be set.

[SouthJamaica]

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@Anonymous wrote:

I have an unused AMEX CM card with a $12K SL (I replaced it with the higher-CB PPMC for non-category spend). This limit represents about 30% of my overall card SL. I only carry a small balance of up to $300 per month on one card (a BCP) for scoring puposes. All my other cards are PIF before posting, so utilization is not an issue.

My only credit-related goal at this time is to try to maintain my scores and overall credit profile to get the best rate on a lease (loan) in June or July of 2021 (a year from now). My income is somewhat low, but steady. I don't pre-qualify for any new cards that excite me, despite having a totally clean file and decent scores (FICO 8 TU/EX/EQ 786/785/769) . I believe it's because I've peaked with my SL relative to my income. I'm concerned that this overall SL peak may affect me getting a good lease/loan deal.

At first I thought I should cancel the card. But then I thought that maybe in the future a different AMEX card may interest me and I could do a product change. I also would like to keep my AAoA as good as possible. I'm leaning towards asking AMEX to reduce the SL on this CM card to $1K-$2K and use it a few times a year and keep it open.

What am I missing here? Any advice is appreciated.

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Just let it be.

PS Closing it wouldn't affect your AAoA because it will likely stay on your reports for many years after closing. Nevertheless, I think you're overthinking things, and do not need to take any action at this time.

[Anonymous]

OP--If it were me, I'd reallocate most of the CL from your CM to your BCP and keep it open. Put a little recurring charge on it (streaming Svc, something small) to keep it active, set it on auto-pay either Statememt Balance or Current Balance, whichever is best for you currently, and just sit back and let it soak.

If there's an Amex Card you like now (or in the future) and aren't concerned about not getting a SUB, and if Amex will PC, that's reasonable too. I've never PC'd with Amex myself. If they decide to buff the CM to make it more attractive and competitive you'll already be there too. That happened to me with my Cap1 QuickSilver. About 4 weeks prior to the roll-out of the 4% Savor and "New" 3% Savor One, I had PC'd my QS to the Savor. So now I'm "grandfathered in" with a 4% Savor and No AF.  I could have closed it with the small CL and numerous other 1.5% & 2% "general use" cards, but it wasn't causing any trouble and ended up giving me a decent little 4% CB Card for Dining and Entertainment. 

We're all talking about "first world problems" here, but you look to be in good shape line-up wise and score wise. No need to trouble yourself too much about it. 

Finally, with no AF, it doesn't hurt you at all, and if/when you acquire newer trade lines, it'll soften the downward departure of your AAoA. If there were an AF involved, I'd likely be of a different opinion. 

Happy Sunday!

[Anonymous]

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@Anonymous wrote:

BCP limit is $5K.

I have considered what you've said regarding auto-paying. I may give that a try for the reasons you gave. I just got into the habit of AZO and it stuck.

Edit: typo

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AZEO every month is a somewhat expensive (in the sense of what is been given up) habit, but I'm sure it makes the issuers happy!