Should I Cancel My Credit One Card?

Anonymous · ‎02-28-2016

Now before you say "Of course you should" heres my situation. I am new to credit Im 21 and just started to build my credit im not rebuilding it like i have had bad credit but I know the Credit one card is used for that alot but building credit is basically the same thing id assume. I am looking to get a mortgage ASAP so Im trying to build my 3 lines of credit for the application. However I received a Credit One Card in the mail for a line of $1000. After reading the horror stories from the internet. I honestly thinking about just cutting my losses paying the 75.00 yearly fee and getting a Captiol One Card for 500$ that I was pre approved for. My current score is hanging around 670.

Should I just pay it off and cancel it? Will it save me trouble in the long run? Or should I wait a year and build it with this card and then replace it down the line with a better card I get accepted for After I get the mortgage? I dont figure my credit score will take too big of a hit but the recovery is what Im worried about. I know credit one cards are for bad credit rebuilding but are they anygood for no credit building?

Anonymous · ‎02-28-2016

Here is my personal take on this.

Keep it.

All of my established lines of credit are too "young" and it is hurting my score.

If the balance is zero and the yearly fee is low enough I'd keep it. I was/am rebuilding and I'd love to have kept a credit card I canceled four years ago. I had just a small limit of 1500 and a yearly fee of 75 bucks. I closed it and went down the paying cash for everything road...foolish and I regret it now that I am trying to buy a house.

Now I wish I had kept it open and just eaten the 75 bucks a year and charged my gas each month on it and paid it off.

I am new to this though so my opinion may be an uneducated one but I'd love to have a 2+ year old credit reporting for me each month.

GirlMelanie89 · ‎02-28-2016

TBH, I would keep it. If you call them and tell them you're thinking about closing it, a lot of time they will waive or cut the fee in half. If you're going to go for a house, I would wait until after for the CapOne card if your mortgage score is already above 640 for an FHA loan. Is the 670 your mortgage score? You want to avoid inquires pre mortgage apping. Congrats at taking the necessary steps for homeownership at such a young age!

Bankruptcy discharged: May 2014 Starting Score: 571 Goal Score: 700
Current Score: 676 (EQ FICO) 674 (EX FICO) 662 (TU FICO)

Mortgage Loan Originator in Kentucky

Anonymous · ‎02-28-2016

@Anonymous wrote:
Now before you say "Of course you should" heres my situation. I am new to credit Im 21 and just started to build my credit im not rebuilding it like i have had bad credit but I know the Credit one card is used for that alot but building credit is basically the same thing id assume. I am looking to get a mortgage ASAP so Im trying to build my 3 lines of credit for the application. However I received a Credit One Card in the mail for a line of $1000. After reading the horror stories from the internet. I honestly thinking about just cutting my losses paying the 75.00 yearly fee and getting a Captiol One Card for 500$ that I was pre approved for. My current score is hanging around 670.

Should I just pay it off and cancel it? Will it save me trouble in the long run? Or should I wait a year and build it with this card and then replace it down the line with a better card I get accepted for After I get the mortgage? I dont figure my credit score will take too big of a hit but the recovery is what Im worried about. I know credit one cards are for bad credit rebuilding but are they anygood for no credit building?

Personally I would keep the Credit One card and either cut it up or put it in a cabinet and not use it to keep the $1000 limit reporting until you get other better cards. Building or rebuilding credit costs money. Look at the $75 AF as an investment towards your financial future. Once you secure a couple more cards from Cap1, BofA, Discover ect. and prior to the Credit One cards anniversary date, I would cancel it depending on your limits with other lenders.

Adding new cards will only bring your score up. What you see in my siggy are not my current scores. I am in the mid to upper 600's now after a month of rebuilding. TU is 675.

Apply for a couple secure cards with Discover and BofA. They both graduate and have no AF. Cap1 should be easy for you to get.

Im no expert and am fairly new to teh rebuilding process and this is just my opinion.

Anonymous · ‎02-28-2016

@GirlMelanie89 wrote:
TBH, I would keep it. If you call them and tell them you're thinking about closing it, a lot of time they will waive or cut the fee in half. If you're going to go for a house, I would wait until after for the CapOne card if your mortgage score is already above 640 for an FHA loan. Is the 670 your mortgage score? You want to avoid inquires pre mortgage apping. Congrats at taking the necessary steps for homeownership at such a young age!

Yeah but the thing is im one year out for the mortgage as this bank one card is my 3rd line of credit and i just opened it this month. So I Would have a year to recover from any credit hit I take towards closing the card with a better card/ credit lender. Would you still keep it in these circumstances?