There will be no immediate loss of age from account closure. Accounts closed in good standing will remain on your reports for approx. 10 years - give or take, during which time they will continue to age and contribute to your age of accounts.
The score penalty for age won't be realized til the account falls off down the road. If this is your oldest account by far, that future impact can be significant.
The only immediate impact is if losing limit increases util, but it seems that will not be an issue for you since your util is quite low.
If you no longer benefit from a card with an AF, I say close it - one less thing to pay/think about. If it didn't have an AF, then keeping it open would be a bit of a non-issue.
**Note: this is for FICO scoring only - Vantage scores my decrease with account closure as closed accounts are treated differently.
@Anonymous wrote:
OK, so just to follow up.. Unfroze and did the app for the WF Active Cash card and was approved for $12.5K... I'll take advantage of the $200 bonus easily.. My annual fee for the Chase card comes up in September so I'll cancel it just before then.. From what I could gather, it shouldnt be an issue quickly raising the CLI with WF - so that part should be a non-issue. I dont really care about the Vantage scores -- and honestly, I wont be seeking any new credit for at least another 2 years anyway when current car lease is up. The WF card is actually the first card I've applied for in 4 1/2 years -- so no "real" worries about the scores.
Have you thought about asking them if you have any retention offers on the card, like waiving the annual fee?
@Anonymous wrote:Hi all.. I have an 832 FICO 8 across EQ/EX/TU.. 3%/3%/2% utilization from total CL of $100K. I have 9 open accounts (8 revolve, 1 loan), 18 closed, no derogatories. I have 1 inquiry on EQ and 2 on TU. My average account age for only open accounts is 12 years, 4 months. I never pay interest, and always pay statement balances in full.
I currently have a Chase Southwest Premier with a $15.5K CL that I used to use as my daily card for everything and PIF each month.. It has a fairly long history on it -- 15.5 years.. At this point, circumstances have changed - I've accrued nearly 150K in Southwest points and I dont need to accrue any more points, and I've switched to a different card in my portfolio for earning cash rewards instead. The points wont expire.. Being that I stopped using the card, I'd like to do something about its annual fee ($99) -- its the only card I have with an AF. My options are limited -- I can only downgrade to the Plus card - but that will only save me $30/year because its a co-branded card, so I cant do a PC. My other option is just cancelling it and taking the 15+ years of account age and $15.5K CL with it. I'd replace the CL with a new card -- likely the Wells Fargo Active Cash -- but I cant do anything about the account age.
In reality -- how much of an impact would the account age and loss of that card have on my score?
Thanks
Rick
Perhaps you're asking the wrong question.
Closing the card will have little or no immediate effect, since it will continue being factored into account age so long as it continues to be in your reports, which will likely continue for years.
Applying for and getting a new card to replace it, though, will cost you a bunch of points.
Update: Oops, I see you've already applied for the new card. I'm sure you'll be fine. Congratulations on your new card.
@Anonymous wrote:I'm sure the new card will have a temporary minimal impact on my scores.. New credit is only 10% of the score impact -- add on top of that the fact that its been over 4 years since my last new revolving account.. Running the simulator says the new card will drop 15 pts - but my experience is the simulator is really only a guess. Thanks!
The simulators are fairly meaningless.
I lost 26 points when I moved from the 'no new accounts in 12 months' scorecard to the lower scorecard. Additionally you will probably get dinged for the inquiry and for lowering average age of accounts. But yes, whatever happens, these effects will be temporary, and even in the short run your scores will be fine since your starting point is so high.