Closed Credit Card Accounts with Balances- How does this affect my score?

[AdPray123]

Hi All,

Before understanding what credit scores meant, I went through a debt counseling program in which many accounts were closed. I now see that was a HUGE mistake but I am confident I will rebound. Anyhow, I still have balances on these that I pay monthly but want to know...

1. Does this debt count in my debt ratio towards my credit score since it is a closed account?

2. Once I pay them off, will my score drop because the account is closed or will my score increase since the debt ratio has been reduced?

Thank you all for your help!

[Anonymous]

Those reporting a Bal  is killing your scores.  When an account is closed  you get no credit for what the CL was BUT the amount that is owed is used against you!!!

After they are PIF  they will report a good TL for 10 years from the date that they were closed.

After they are PIF  yes you will see an increase in your scores.

What you need are CCs that that report a CL to lower you UTIL.

[AdPray123]

Thanks Happy Days,

What is CL, TL, and UTIL? Im new to a lot of this language. You have been very helpful

[GFer]

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@AdPray123 wrote:

Thanks Happy Days,

What is CL, TL, and UTIL? Im new to a lot of this language. You have been very helpful

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This will help!

http://ficoforums.myfico.com/fico/board/message?board.id=Welcome&thread.id=23

Then check out Tuscani's Credit Scoring 101:

http://ficoforums.myfico.com/fico/board/message?board.id=ficoscoring&thread.id=29793

Message Edited by llecs on 11-26-2008 03:32 PM

[AdPray123]

Great! Thanks Thank Helped Alot!!!!!