Hello everyone - I thank you in advance for any help you can give me. My accounts for the reorting agencies are all in the 760 to 765 range, which I guess is respectable but not "blow your socks off." According to Myfico's scoring wrap up, there is only one thing on my credit history considered negative - MyFico says I have too many accounts, which is 50. And at least when these records were run, I have 11 of those accounts with balances totaling $11,811. in the past couple of months, I have paid off all my cards with balances, except one, which now has a balance of about $4000.00 but this is all I owe on any of my 50 cards. I consider paying off almost $7000 in the last few months a positive move, although I wish the Myfico records showed that. My first question: If 50 cards is too many, how many should I close? I thought closing accounts was a no-no. I know it screws up some kind of total, although I'm not sure what. My second question: My game plan is to continue charging mainly on the one card that now has a balance and pay at least $2000 on it a month, more if I can. Is this a good strategy? And also, how long does it take the reporting agencies to note when large payments, such as mine, have been made? And any idea how much a $7000 overall balance decrease will impact my scores? Thanks again) 
@naf wrote:
Hello everyone - I thank you in advance for any help you can give me. My accounts for the reorting agencies are all in the 760 to 765 range, which I guess is respectable but not "blow your socks off." According to Myfico's scoring wrap up, there is only one thing on my credit history considered negative - MyFico says I have too many accounts, which is 50. And at least when these records were run, I have 11 of those accounts with balances totaling $11,811. in the past couple of months, I have paid off all my cards with balances, except one, which now has a balance of about $4000.00 but this is all I owe on any of my 50 cards. I consider paying off almost $7000 in the last few months a positive move, although I wish the Myfico records showed that. My first question: If 50 cards is too many, how many should I close? I thought closing accounts was a no-no. I know it screws up some kind of total, although I'm not sure what. My second question: My game plan is to continue charging mainly on the one card that now has a balance and pay at least $2000 on it a month, more if I can. Is this a good strategy? And also, how long does it take the reporting agencies to note when large payments, such as mine, have been made? And any idea how much a $7000 overall balance decrease will impact my scores? Thanks again)
I'm not sure where you are getting the idea that 760+ FICO scores are just decent. You are a FICO high achiever and should easily qualify for the best auto/mortgage rates, or most likely any credit cards.
What was your %utilization before and after you paid down the $7K in revolving debt ? It should help your FICO score to reduce your %util, and most people report that the optimal FICO scoring point is to have one account reporting a balance, at less than 9% of your CL.
You have nothing to apologize for, we all have to learn new things at some point.
Utilization is just some simple algebra. Here is an example:
Let's say you have 3 credit cards and they have the following balances and credit limit (CL): card1 - $100/1000, card2 - $0/1000, card3 - $200/1000.
Then your overall utilization is (100 + 0 + 200) / (1000 + 1000 + 1000) = 300/3000 = 0.1, which is 10% of your total credit limit.
FICO takes into account not only your total utilization but also individual utilization for each card. Ideally you should let only 1 card report 1-9% of its credit limit and the rest of them report $0.
Starting Score (08/11/11): TU08: 643
Regarding when FICO will notice your payments - usually when the card statement closes and shows a lower balance, it'll take a few days to hit the CRAs.
Regarding closing cards:
Closing a card would have two effects:
1. It will eventually lower your AAoA (Average age of accounts). Contrary to popular opinion it won't hit you instantly. A closed card stays on your report for 10 years and FICO includes closed cards when factoring your AAoA.
2. It could increase your overall utilization because you have less available credit. In Guava's example, say you close card 2. Now your overall util is 300/2000 = 15%.
If you close a card that has a balance then it's even worse because you still owe the debt but don't have the credit.
How many cards should you close? That's a tricky one. You'll get different answers from various people. The general consensus would usually be to keep however many cards you can effectively manage. If it gets so complicated that things fall through the cracks, it's time to simplify.
My personal opinion is to evaluate what card is doing for you. If you are getting good rewards from it, taking advantage of an interest rate, or other perks, it's worth keeping. Otherwise it's just clutter. If a card has an annual fee it's not worth keeping unless I am actively using it in a way that the rewards or other benefits justify the fee. It's not worth paying an AF just for the sake of account age. Saving money trumps a marginal boost in score every time.
If you have a bunch of open unused cards just laying around some people would say to sockdrawer them instead of closing them so they can age, but in your case I think the overabundance of cards is actually hurting you so it's time to trim the fat.