I have a Cap One account that was charging me a high annual fee and had a low credit limit. I called a few months ago to have the annual fee waived they refused, they also wouldn't raise the credit limit so I decided to close the account
There was a zero balance on it. The credit limit it did have was made up for by other accounts so I'm at a loss as to why my Fico score dropped about 20 points. 
I was at 728 now I have a 708
The only thing I can think of was that it dropped due to loss of age but if the account will still report for 10 years how is this possible?
The thing is I have another card with a high annual fee and APR that I want to close but if I do my score will more than likely tank further.
If I had known my score was going to drop this much I never would have closed it
@Anonymous wrote:1-9% ? That's interesting because I've read that you should use no more than 10%
Does 1% really matter that much?
Some people report an advantage to their score at 1% or so. Others say for them a zero balance seems to have no negative effect. This is called tweaking your score. The general consensus though seems to be that anything less than 10% is a good thing. And Fico rounds up so for example an actual utilization of 9.5% will show as 10%,
Now I wait patiently for different opinions about this. 
10%-25% util on a revolving account is still not that bad... you don't lose that many points. But if you do that much on ALL your cards, that brings your overall % to that amount, which could affect you more than a single account being at 10-25%.
You'll get some damage going beyond 35% on a single account. Major damage if your total utilization % is at that level or higher--then you start to look like a "max out" who lives off of credit.
This really sucks, but if you want to revolve larger balances, you need way bigger CLs to have room to do it. $1,000 CL means you shouldn't revolve more than $100 on that card if you want to avoid any loss of points.
If you pay your cards off every month it does not matter---what matters is what the balance on the account is showing when your lender scans their books to upload their status files to the CRAs. Sites like TrueCredit do tell you the reporting date the creditor said they pulled your account. Most of the time this date on or right before the beginning of the statement cycle.
I've read on here that if you keep your balances reporting at $0 for a long time, FICO considers your use of credit "inactive" on that account since there's no activity showing, even if you are using the account [you just pay the thing off very quickly].
I will be a living example of the $0 effect. I'm trying it out for 2010. I'm not letting a single one of my accounts report a balance at all this year. Not even one penny.
