When's the right time to cancel store and subprime cards?

[Anonymous]

First off, let me tell you guys I'm buying a house. Closing is supposed to be the end of the month. Now after that's all said and done, I want to get rid of all these low balance cards- when the time is right... I know my credit profile needs time in the garden to grow because this time last year, I had ZERO cards. I will say these secured and store cards did their jobs. 

So should I wait until all the cards are over at least one year and then make some changes? I plan on keeping my oldest comenity card. I just got the SL increased from $250 to $1,250 yesterday but what's the point of the secured cards? OpenSky is the only card with an Annual Fee. 

[DaveInAZ]

Well first of all don't close any account and especially don't apply for any new account until your mortgage closes. Mortgage underwriters don't like to see any changes on a credit report, and they'll review your credit report again before closing.

After closing on your mortgage:

- Close Open Sky before the next annual fee hits.

- Store cards: Close ones where you don't shop regularly, or can pay with a rewards card

- Secured cards: Which ones do you have? The point of secured cards is to get in with a creditor who won't give you an unsecured card. Bank of America secured cards at a good way to get in with BoA, they graduate to unsecured at 1 year or less. I included a BoA credit card in my 2010 bankruptcy, and started with a $300 secured card in 2015, now I have 2 CCs with them with $5k credit limit each. Discover secured card is another one that can lead to a good unsecured credit card from them.

[Anonymous]

I have capital one secured and open sky secured. I have a recurring charge on my cap1 that I let report a $5 balance every month while every other card i have is always zero.

[Anonymous]

Nice response by Dave.  My only additional thought is that you should not close cards if closing them will cause your total number of open cards to drop to less than five.  An exception would be cards that charge fees.

[Anonymous]

Ok so five is the magic number eh? I’ll keep that in mind. Only open sky had the AF so I’ll keep it until the 11th month. Glad it’s not my oldest card.

[SouthJamaica]

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@Anonymous wrote:

First off, let me tell you guys I'm buying a house. Closing is supposed to be the end of the month. Now after that's all said and done, I want to get rid of all these low balance cards- when the time is right... I know my credit profile needs time in the garden to grow because this time last year, I had ZERO cards. I will say these secured and store cards did their jobs. 

So should I wait until all the cards are over at least one year and then make some changes? I plan on keeping my oldest comenity card. I just got the SL increased from $250 to $1,250 yesterday but what's the point of the secured cards? OpenSky is the only card with an Annual Fee. 

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1. Congratulations on the amazing 1-year turnaround you accomplished.

2. IMHO you don't need to do anything except ditch the Open Sky card due to the annual fee (after the mortgage closes).

3. In the future I would recommend avoiding any more store cards.

[Anonymous]

Those last store cards I got 3 months ago I really regret. I wasn’t as knowledgeable as I am now. They were soft pulls but still they annoy me.

[SouthJamaica]

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@Anonymous wrote:
Those last store cards I got 3 months ago I really regret. I wasn’t as knowledgeable as I am now. They were soft pulls but still they annoy me.

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What's done is done. And it can't have been wrong.... you picked up hundreds of FICO points, and a mortgage! I'm just talking about going forward.  What you've accomplished to get to this point is terrific.

[Anonymous]

Thanks a lot. I’ve worked hard to get here. Once this closing is complete, I want to get a real card. My two non-store card are only secured at $200 a piece. I couldn’t even rent a car with either of those cards. My TU and EQ reports have no age but my EX has almost 4 years AAoA and the least inq’s. Given the fact that Amex has pre-qual’ed me, I’m thinking that’s the route I’ll Take in the future to get started.

[SouthJamaica]

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@Anonymous wrote:
Thanks a lot. I’ve worked hard to get here. Once this closing is complete, I want to get a real card. My two non-store card are only secured at $200 a piece. I couldn’t even rent a car with either of those cards. My TU and EQ reports have no age but my EX has almost 4 years AAoA and the least inq’s. Given the fact that Amex has pre-qual’ed me, I’m thinking that’s the route I’ll Take in the future to get started.

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The most useful cards I've found are from credit unions, but you should get what works for you.