too many closed accounts hurt score?

[Enny]

Is there such a thing that the amount of closed accounts hurt your score and/or that lenders may consider this a criteria not to give a loan or credit card?

I am aware of general impact of closing account. IT takes away the credit line you have and overall increases the credit utilization. And closed accounts drop of the report after 10 years which then may reduce average acount age.

[Gratitude]

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@Enny wrote:

Is there such a thing that the amount of closed accounts hurt your score and/or that lenders may consider this a criteria not to give a loan or credit card?

I am aware of general impact of closing account. IT takes away the credit line you have and overall increases the credit utilization. And closed accounts drop of the report after 10 years which then may reduce average acount age.

You are aware of the pitfalls.. good so how many is too many?  Once an account is closed you are measuring from that point (that said, you can search on the forum about reopening accounts).

Based upon where your score and account wise without closing anything additional and assuming you are looking to app for something now here are a few of the questions in regards to what a Creditor will measure  -

(also these are a few of the basic data points that some of the pros on this forum will need to give you a better answer):

• How many accounts are open?
• How many CC’s how many Loans?
• Are any reporting late?
• Do you have any Baddies/ if so what  situation/ how many situations?
• What the the age of your oldest account?
• What is the Average Age of Accounts (open)?
• What is your Aggregate Utilization?
• Are any of your open accounts balances over 48%?
• Do you absolutely need to app right now?

(what did I miss guys?)

@Enny Let us know these data points... Folk here will give you some great insight!

[Anonymous]

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@Enny wrote:

I am aware of general impact of closing account. IT takes away the credit line you have and overall increases the credit utilization. And closed accounts drop of the report after 10 years which then may reduce average acount age.

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There's a few other ways that closing an account can affect your score. 

Paying off a loan (i.e. closing it) can hurt your score.  That's if the closure means you have no open loans left, or if the closure affects something people here call "total installment utilization" or "total B/L ratio."

Closing a credit card can hurt your score if it brings your total number of open cards to < 3.  I'd be careful about a closure that brought me to < 5 cards, personally, but certainly < 3.

Finally, closing one's oldest open account can affect a factor called Age of Oldest Account -- not immediately but down the road.  Age of Oldest Account is a factor different from Average Age of Accounts (AAoA).  A good rule of thumb is to avoid closing one's oldest credit card -- unless it is close to the same age as your next oldest card, or there is an annual fee for it.

[Moneyklutz]

I could be wrong here but I read your question as; "Does the aggregate number of closed accounts hurt my score?" 

If so, I don't believe that number is factored in on how FICO scores are calculated. Closed accounts can affect your score in the ways CGID explained but not as a numeric total.   

[Anonymous]

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@Moneyklutz wrote:

I could be wrong here but I read your question as; "Does the aggregate number of closed accounts hurt my score?" 

If so, I don't believe that number is factored in on how FICO scores are calculated. Closed accounts can affect your score in the ways CGID explained but not as a numeric total.   

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Yeah, I forgot to address the OP's main question.  The mere appearence of many closed accounts is not a penalty factor.  The OP also asks if it could spook a creditor, which I suppose is possible but I would worry more about an asteroid collision. 

[Anonymous]

I don't think that the number of closed accounts would really matter.  Perhaps if if was a large number AND all of them were closed by the credit grantor it would raise an eyebrow upon a MR, but that's about it.

Out of curiosity, why does this topic concern you?

[Enny]

Thanks everyone for your responses.

Well a bank where I have/had old and new cards with, closed all of them saying I opened to many accounts and have high utilization.

Not really my fault if they offer 0% APR and I take advantage of it. Never pay late and always pay full balance, unless I have 0% APR. 

I know I can request reopening the accounts but that usually means a hard inquery and the credit situation on why they closed the accounts hasn't changed, so they may deny that request. I'll see in a while when the utilization is down to request reopen at least the oldest accounts.

[Revelate]

Some older FICO models appear to look at total number of accounts and too many is a problem.

That said it's utterly unknown if closed cards factor into this... if they do it's likely the same, if they don't, it's still /shrug.  FICO 8 and FICO 9 don't seem to care regardless and that's the future anyway once the GSE's transition to something else.

I wouldn't worry about it: if you want to close the tradeline close it... FWIW you can always explain it away as "I didn't understand credit when I opened all those accounts, so I reduced the number to be responsible with my credit."  Like any lender isn't going to treat that rationale favorably?