seancanputt asked:
I don’t know if it is better to close out an existing card or leave it open. It used to be recommended to close it. Now, I think we are supposed to leave them open. Which affects the credit rating more?
http://1mortgagecalculator.info
I don’t know if it is better to close out an existing card or leave it open. It used to be recommended to close it. Now, I think we are supposed to leave them open. Which affects the credit rating more?
http://1mortgagecalculator.info
It doesn’t matter whether you leave it or close it; it will not affect your credit rating (unless you incur debt with the credit card). I think you should rather worry the annual fee, every year they will be a fee deductible for the use of the card. So if don’t close it, you will have to pay the annual fee.
Closing a credit card account would decrease your available credit, which could increase your debt to available credit ratio (if you are using any credit), which would tend to decrease your score.
Closing an account you have had for awhile can also decrease your credit score by decreasing the length of your credit history (good closed accounts tend to drop off of your history faster than bad things).
Leave the other credit card open but you should never transfer balances from one card to another because then the company can raise your interest rates because you have a higher balance now.
It is better to leave it open so it can help you with your credit score if you are in USA, I believe it will help you in many countries not just in USA, think simply, if you have four credit cards and each have $2500 limits, it simply make your profile $10000 and risk of loosing your credit score is 25%. If your credit card is over lowered because of your credit card over drafted, think it will be based on the 4 cards not one, so it is better to have many credits cards actually if you don’t use them.
Closing out the card can lower you score.
If that is one of your older/oldest cards, your credit history will look shorter than it is if you close out the card.
For ex. you have 2 cards, one you’ve had for 5 yrs, the other for 7. If you close out the card you’ve had for 7yrs, it’ll now look like you have a 5yr credit history.
If the total credit you have available is 5000 amongst 2 cards, one is 4000 and the other is 1000 and you close out the 4000 card you could negatively effect your score.
keep it open, do not use it.
It is not necessary that you close or remain open your old credit card. It did not affect your new account but there should not be any debt in the old account.