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Should I Cancel Idle Credit Cards?

Ask Savvy: Should I Cancel Idle Credit Cards?

Dear Savvy,
I recently bought a condo and to buy my furniture did one of those no payments no finance for furniture. Obviously paying off quickly. I'm wondering if I should then immediately cancel the credit card? I'm not planning to use it again. I also have a store card that i never ever use. My question is I've heard conflicting advice that if you cancel the cards it lowers your credit score. Obviously at the moment am not purchasing a home but want to maintain to credit score I have.

To see my answer just

A: Wait until there's a zero balance on both cards and then cancel them; you need to keep the credit lines open until the accounts are paid off. Because you just bought a condo, I'm assuming that you have other older credit cards that will serve as your credit history. After the balances are down to zero, call the issuers and ask them to cancel the cards with a note to the credit bureaus that the account was "closed at customer's request." Make sure you take notes of when you called and the name of the customer service representative.

All of the conflicting advice about closing accounts is enough to make my head spin. It's true that canceling a large amount of unused credit could actually hurt your credit score, so if you're shopping for a car or a home wait until you've secured a loan before you close any credit lines. Credit cards help build a credit history, but having too many can hurt it. Even having a drawer full of cards at a zero balance could push your score down.

The most important point in considering closing a card? If it has a long track record of you've made the payments on time, you'd be losing that good piece of credit out of your score. Keep the few cards that you've had the longest because lenders see these accounts as a sign that you're mature and creditworthy. Time really is an important consideration with credit cards — fifteen percent of your credit score is based on how long you've been using credit.

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njnikusha njnikusha 7 years
i have a question guys? one of the user mentioned that has " I have a bag of unused cards and my credit score is high". is there a even a slightest chance that those unused cards could be closed by the issuer bank? therefor to hurt the credit score
DMBloyola6 DMBloyola6 7 years
YAY! This was exactly what I was looking for. For the longest time, I had two credit cards -- one with an amazing credit line, and one with the dinkiest of the dink. I just got a new one and was going to dump the dinky, but now I'll hold on to it for awhile, buy something small each month, and pay it off. Really appreciate the info!
Bee333 Bee333 8 years
Sorry about the double. One other thing-- I've read that outstanding LIBRARY FINES can damage your report as much or more than credit cards. Major suckage. The library has all your pertinent info to wield against you for this tax-payer funded "free" service. (I have a fine I refuse to pay at the moment because of the way they worded how long they were closed and they fined me an extra day even though I'd already returned.) Anyway, every time I went to that particular library, I ALWAYS was hearing how someone owed fine money. Not just one person, many people, and this is in a nice neighborhood. Is that just a stinker library or is this typical? (That library has no mercy!!)
Bee333 Bee333 8 years
Sorry about the double.One other thing--I've read that outstanding LIBRARY FINES can damage your report as much or more than credit cards. Major suckage. The library has all your pertinent info to wield against you for this tax-payer funded "free" service. (I have a fine I refuse to pay at the moment because of the way they worded how long they were closed and they fined me an extra day even though I'd already returned.) Anyway, every time I went to that particular library, I ALWAYS was hearing how someone owed fine money. Not just one person, many people, and this is in a nice neighborhood. Is that just a stinker library or is this typical? (That library has no mercy!!)
Bee333 Bee333 8 years
Sorry about the double. One other thing-- I've read that outstanding LIBRARY FINES can damage your report as much or more than credit cards. Major suckage. The library has all your pertinent info to wield against you for this tax-payer funded "free" service. (I have a fine I refuse to pay at the moment because of the way they worded how long they were closed and they fined me an extra day even though I'd already returned.) Anyway, every time I went to that particular library, I ALWAYS was hearing how someone owed fine money. Not just one person, many people, and this is in a nice neighborhood. Is that just a stinker library or is this typical? (That library has no mercy!!)
Bee333 Bee333 8 years
I still don't know what to do after reading all these comments! I have store cards that I haven't used in years, nor have received mailings from them. One I recently tried to use and could not because it was dormant for maybe a year or two and my credit went to $0...was informed I'd have to "just re-apply." So, are cards like this technically canceled? Or just inactive?? As in, if I cut it up, even if it's been inactive and I've received 0 communication from the store in years, is it still active until I notify the company??There are stores, like JCPenney or Sears that, though you don't use them once a year or for years, the account can still be used. Also, if I cancel such cards now, but sometime in the future re-apply for a major purchase, is that a slap to credit? I know I have too many cards and try to keep it to a handful, mostly one. We recently moved and credit never came up as an issue. Please help!! (take into consideration that the bills are paid)
Bee333 Bee333 8 years
I still don't know what to do after reading all these comments! I have store cards that I haven't used in years, nor have received mailings from them. One I recently tried to use and could not because it was dormant for maybe a year or two and my credit went to $0...was informed I'd have to "just re-apply." So, are cards like this technically canceled? Or just inactive?? As in, if I cut it up, even if it's been inactive and I've received 0 communication from the store in years, is it still active until I notify the company??There are stores, like JCPenney or Sears that, though you don't use them once a year or for years, the account can still be used. Also, if I cancel such cards now, but sometime in the future re-apply for a major purchase, is that a slap to credit? I know I have too many cards and try to keep it to a handful, mostly one. We recently moved and credit never came up as an issue. Please help!!(take into consideration that the bills are paid)
Bee333 Bee333 8 years
I still don't know what to do after reading all these comments! I have store cards that I haven't used in years, nor have received mailings from them. One I recently tried to use and could not because it was dormant for maybe a year or two and my credit went to $0...was informed I'd have to "just re-apply." So, are cards like this technically canceled? Or just inactive?? As in, if I cut it up, even if it's been inactive and I've received 0 communication from the store in years, is it still active until I notify the company??There are stores, like JCPenney or Sears that, though you don't use them once a year or for years, the account can still be used. Also, if I cancel such cards now, but sometime in the future re-apply for a major purchase, is that a slap to credit? I know I have too many cards and try to keep it to a handful, mostly one. We recently moved and credit never came up as an issue. Please help!! (take into consideration that the bills are paid)
jrosenberg02 jrosenberg02 8 years
My financial aid advisor explained to me that it's both the history of cards you close and the amount of available credit they have on them. A big component of your credit score is the percentage of available credit you're using - the less the better (although you do need to use some - relatively small balances paid off in full each month are supposed to be best). So if you close out 6 credit cards and lower your available credit from $50,000 to $5,000 your score would still likely go down even if the one card you kept is the one you've had the longest. I don't know about anyone else, but my oldest card definitely has the smallest limit since I've never bothered to ask them to raise it, and I certainly didn't qualify for a huge limit when I got it in college!
jrosenberg02 jrosenberg02 8 years
My financial aid advisor explained to me that it's both the history of cards you close and the amount of available credit they have on them. A big component of your credit score is the percentage of available credit you're using - the less the better (although you do need to use some - relatively small balances paid off in full each month are supposed to be best). So if you close out 6 credit cards and lower your available credit from $50,000 to $5,000 your score would still likely go down even if the one card you kept is the one you've had the longest. I don't know about anyone else, but my oldest card definitely has the smallest limit since I've never bothered to ask them to raise it, and I certainly didn't qualify for a huge limit when I got it in college!
sophia_HL sophia_HL 8 years
Jenehfer is right !! It all depends on how much debt you have!! If you have a large amount of student loans, you should keep it so that your debt to credit ratio is balanced. I have a bag of unused cards and my credit score is high.
karisaamy karisaamy 8 years
Thanks for the info, this is something I've been wondering about for a while
omilawd omilawd 8 years
Establishing credit is tricky, and I'm sure I'm not the only one who has a lot of questions about credit cards, credit scores, etc.Savvy, is there any way you could have a feature about credit?
omilawd omilawd 8 years
Establishing credit is tricky, and I'm sure I'm not the only one who has a lot of questions about credit cards, credit scores, etc. Savvy, is there any way you could have a feature about credit?
beingtazim beingtazim 8 years
very interesting. i didn't know that keeping these cards on hand would make such a difference
kiwitwist kiwitwist 8 years
Great advice!!!!
kiwitwist kiwitwist 8 years
Great advice!!!!
lms lms 8 years
I have quite a few 0 balance cards as well and my score is over 800. I have had one of them for probably around 18-20 years(since I was a teen). I think it matters that you pay in a timely fashion. That is what keeps your score up IMO.
chakra_healer chakra_healer 8 years
Megmccoy, I hope Savvy answers your question.Personally, I have always considered longevity the key. I rarely apply for new credit, but when I do, I keep the account. Short term accounts lower the average age for your scores.
chakra_healer chakra_healer 8 years
Megmccoy, I hope Savvy answers your question. Personally, I have always considered longevity the key. I rarely apply for new credit, but when I do, I keep the account. Short term accounts lower the average age for your scores.
megnmac megnmac 8 years
Just how many cards are too many? Seven isn't actually all that crazy in today's world, and I have gone through several times (typically moves) where I'll get a zero APR promotion card in order to float me for a month or two and the rest of my life keep the balances paid off. But constantly signing up for these cards, as well as say an amazon.com card to get a discount and store cards to get a discount and the ones that link in with my checking acct at my bank... it adds up. I keep track of what is what, use one primarily and pay it off, but is there a cutoff of how many are too many?
jenehfur jenehfur 8 years
keep it open. a large part of what determines your credit score is the ratio of your debt to available credit!
chakra_healer chakra_healer 8 years
If I were advising the OP, I would tell her to keep the account open for at least a year or two. Show a history by purchasing a napkin or lamp every few months and paying in full, then close it after building a solid history. Paying off the initial debt quickly is great, but you can build off of it, especially for a higher credit line. You may never use it, but having open higher limit accounts will demonstrate that you can handle those higher limits and may influence analysts when they set limits for a new account.Also, I disagree with the part about having too many zero-balance cards can hurt your score.I have several, in fact, the majority of my cards are paid in full, others I only use for particular purchases, like hotel stays and sit idle most of the year; my credit scores are all mid to high 700s.I never cancel credit cards. They are constantly working for me by building a long history (I have about seven cards with 10 years of perfect history), showing a mix of different credit card types (several store, 1 charge, 2 student, the rest prime), and they keep my utilization extremely low (which is an important factor in scoring).
chakra_healer chakra_healer 8 years
If I were advising the OP, I would tell her to keep the account open for at least a year or two. Show a history by purchasing a napkin or lamp every few months and paying in full, then close it after building a solid history. Paying off the initial debt quickly is great, but you can build off of it, especially for a higher credit line. You may never use it, but having open higher limit accounts will demonstrate that you can handle those higher limits and may influence analysts when they set limits for a new account. Also, I disagree with the part about having too many zero-balance cards can hurt your score. I have several, in fact, the majority of my cards are paid in full, others I only use for particular purchases, like hotel stays and sit idle most of the year; my credit scores are all mid to high 700s. I never cancel credit cards. They are constantly working for me by building a long history (I have about seven cards with 10 years of perfect history), showing a mix of different credit card types (several store, 1 charge, 2 student, the rest prime), and they keep my utilization extremely low (which is an important factor in scoring).
Lovely_1 Lovely_1 8 years
Awww savvy I love your advice! Thanks hun :)
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