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dropped 11 points for closing young low limit cc?

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Anonymous
Not applicable

dropped 11 points for closing young low limit cc?

11 months ago I began paying attention to my credit after messing up a few years ago, and my first cc was a CapOne platinum with $350 starting CL eventually raised to (measly) $500. So far on my rebuilding journey in the last 11 months I've also acquired a Discover It $7500CL, Amex Gold Delta $6000, CapOne Quicksilver $3500, Target RedCard $800, Victoria's Secret Angel $750, and Amex PRG npsl (but I know it's at least $7500 according to "check your spending ability," I'm too scared to check any more). I hardly use the starter card because of my vastly better options, and since the annual fee was about to kick in I decided to close it out. I understand it's generally important to let cards age, but all these other cards were opened around the same time so they'll help to anchor my AAoA in the future, plus the CapOne's annual fee, low limit, lack of rewards, and high APR made closing it a no-brainer. 

 

I understand closing a tradeline can lower score because (1) less available credit in total limits means increased utilization, and (2) AAoA lowers if the closed account was an older one. However, neither of those stipulations apply to this scenario. My overall credit limit decreased from $19,050 to $18,550 which is extremely insignificant, especially considering my total balance of cc accounts is hovering around 1%. AAoA hasn't gone down, and anyway I thought that ding wouldn't come into effect for another 10 years when the closed account is eventually taken off my credit report. 

 

Within a day or two of closing, I received alerts that EX dropped 1 point because of the closed account, EQ dropped 4 points because of the closed account, and TU dropped 6 points with no reason given but it's safe to assume it's the closed account since absolutely nothing else changed (no new statements were reported in those 2 days or anything). So... what gives? Does this drop make sense? It's pretty discouraging since over the past 11 months I've brought my scores up from 618ish to hovering just above 700. Now I'm hovering just under the milestone of 700, and I don't understand why. 

 

Does anyone have any insight or similar experiences?

Message 1 of 3
2 REPLIES 2
gdale6
Moderator Emeritus

Re: dropped 11 points for closing young low limit cc?


@Anonymous wrote:

11 months ago I began paying attention to my credit after messing up a few years ago, and my first cc was a CapOne platinum with $350 starting CL eventually raised to (measly) $500. So far on my rebuilding journey in the last 11 months I've also acquired a Discover It $7500CL, Amex Gold Delta $6000, CapOne Quicksilver $3500, Target RedCard $800, Victoria's Secret Angel $750, and Amex PRG npsl (but I know it's at least $7500 according to "check your spending ability," I'm too scared to check any more). I hardly use the starter card because of my vastly better options, and since the annual fee was about to kick in I decided to close it out. I understand it's generally important to let cards age, but all these other cards were opened around the same time so they'll help to anchor my AAoA in the future, plus the CapOne's annual fee, low limit, lack of rewards, and high APR made closing it a no-brainer. 

 

I understand closing a tradeline can lower score because (1) less available credit in total limits means increased utilization, and (2) AAoA lowers if the closed account was an older one. AAoA isnt affected right away, closed positive accounts remain on file for up to 10 years post closing. However, neither of those stipulations apply to this scenario. My overall credit limit decreased from $19,050 to $18,550 which is extremely insignificant, especially considering my total balance of cc accounts is hovering around 1%. AAoA hasn't gone down, and anyway I thought that ding wouldn't come into effect for another 10 years when the closed account is eventually taken off my credit report. 

 

Within a day or two of closing, I received alerts that EX dropped 1 point because of the closed account, EQ dropped 4 points because of the closed account, and TU dropped 6 points with no reason given but it's safe to assume it's the closed account since absolutely nothing else changed (no new statements were reported in those 2 days or anything). So... what gives? Does this drop make sense? It's pretty discouraging since over the past 11 months I've brought my scores up from 618ish to hovering just above 700. Now I'm hovering just under the milestone of 700, and I don't understand why. 

 

Does anyone have any insight or similar experiences?


Something else has changed besides the closed account as it would not cause the point drop. Look for a change in the way a single month of payment history is reported or something along those lines. Welcome to My Fico Smiley Happy  

 

Personally for myself I dont even worry about score changes +- 20 points

Message 2 of 3
Anonymous
Not applicable

Re: dropped 11 points for closing young low limit cc?

Thanks for the optimistic words! I look forward to the day when I don't have to worry about changes under 20 points. Getting stuck under 700 feels like a big difference from being over 700 though. 

 

I do understand that AAoA isn't affected until 10 years later, which was mentioned just a couple sentences after your insertion. The thing is everything else in my report really has been kept consistent (even my 2 cards reporting a balance this month are $6 and $11 different from their balances last month). Additionally, the EQ and EX alerts specifically listed the CapOne account change as the reason for the point drop, which is why I'm so confused. 

 

Anyway, I still appreciate the welcome to the myfico forums!

Message 3 of 3
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