OK to cancel credit cards?

[Muse]

You're welcome :awe:

If I opened the Chase Amazon, is my credit limit the same as the Freedom I already have? It's gone up considerably since I've opened the Freedom. If my limit starts low, it may save me during Amazon's sale next week. If I opened a Discover, I would probably start with a low limit since it's a new account and I've never been a cardholder with them....

I have no idea how they establish limits. In my experience, they issue you a card, it has a limit. You can contact them and ask to have the limit increased if you want, they'll evaluate your request. I've done that, and successfully, but in general I've never had a problem with the limits on my cards, don't make big or a lot of accumulated purchases so I don't pay much attention to them. It took me a long time to get my first CC, so I don't take it lightly. I didn't have bad credit, I just had basically no credit history. They told me to open a card at a store, establish some history and go from there, they didn't care that I had a full time job it seemed. Finally, I was awarded a card with a low limit. After that, I've never had issues getting cards, the offers keep coming in the mail. But it seems that the best cards these days don't send you letters, you have to contact them.

 

[CraKaJaX]

I have no idea how they establish limits. In my experience, they issue you a card, it has a limit. You can contact them and ask to have the limit increased if you want, they'll evaluate your request. I've done that, and successfully, but in general I've never had a problem with the limits on my cards, don't make big or a lot of accumulated purchases so I don't pay much attention to them.

Yea, I've had the same experience as well. In one scenario Chase actually contacted me because they noticed I updated my billing address. They asked me if I moved because of work, in which it this case it was. They then asked if my salary increased... which it did. Because of the change in salary, they increased my limit another ~4k.

 

[highland145]

Speaking of heloc, I have one. I used it some years ago, it's set to expire. My bank keeps sending me letters asking me to renew it, but I don't intend to ever use it. I have a lot of cash, so no point in borrowing against the heloc. Is there a downside to just letting it expire?

Again, depending on the whole picture but it sounds like you're in good sharp with $$. If they're going to do it for free ( or next to) I'd have a hard time not renewing it.

I did renew mine when I went to my new bank. Haven't used it but you never know what might happen. I'm looking at 2 offices (hopefully) next year which will take a lot of $$ up front (not borrowed $$). If some major emergency comes up, I want to be able to cover it. Although I do hate the idea of owing on my house.

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

 

[feralkid]

I was literally just looking up how credit score is affected when OPENING an account. The Amazon anniversary sale thread has me thinking I want to open a new card (currently a Chase Freedom holder since 2012) and was looking at either the Chase Amazon rewards (3% back year round) card or Discover It (5% back on Amazon this quarter). The Chase Freedom is my only CC right now. :hmm:

That's the only way to do it; when you only figuratively look it up, the results can be unreliable.

 

[CraKaJaX]

That's the only way to do it; when you only figuratively look it up, the results can be unreliable.

:sneaky:

 

[repoman0]

I have a bunch of old cards I need to cancel. I'm doing a master's through my work, but they only reimburse after I get my grades for the semester .. so I like to open temporary 0% cards, charge $11k of tuition on them and collect both the intro rewards and cash back, and then pay it off in full when I get reimbursed. Problem is the intro deals are usually 1 year or so, so the deal is expired by the end of the following semester and I rack up a bunch of unused cards.

It's a pain in the ass but I've collected a solid $1500 in cash back just from that scheme. 0% intro APR deals are awesome and are basically a free short term loan with cash back on top of it if you pick the right ones.

 

[dank69]

... Benjamin Disraeli (British prime minister) said "the most delicious thing in the world is a banana." ...

What a stupid thing to say.

 

[Muse]

What a stupid thing to say.

Maybe some hyperbole there.

On the other hand, Benjamin Disraeli, the 19th-century British prime minister, wrote in a letter from Egypt, "Oh, the delicious fruits that we have here and in Syria! Orange gardens miles in extent, citrons, pomegranates; but the most delicious thing in the world is a banana, which is richer than a pineapple."

http://www.deseretnews.com/article/148111/WORLD-IS-BANANAS-ABOUT-TROPICAL-FRUIT-WITH-REAL-APPEAL.html?pg=all

 

[ultimatebob]

I had a Citi card through school that I haven't used since I graduated (2010). About a year ago I got an email of my account being closed due to inactivity. I'm not sure if my credit took a hit due to that, but never contacted them about it either because I never used it.

Yeah, I try to use all of my cards at least once a year to prevent that from happening.

 

[Mxylplyx]

I have more cards than I can count now in order to take advantage of signup bonuses. The more cards the better, particularly if you carry a balance, as higher credit lines lower your total utilization. My credit score has shot up over 800 since playing the travel rewards game the past 3 years.

 

[Thump553]

Again, depending on the whole picture but it sounds like you're in good sharp with $$. If they're going to do it for free ( or next to) I'd have a hard time not renewing it.

I did renew mine when I went to my new bank. Haven't used it but you never know what might happen. I'm looking at 2 offices (hopefully) next year which will take a lot of $$ up front (not borrowed $$). If some major emergency comes up, I want to be able to cover it. Although I do hate the idea of owing on my house.

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

Make sure you check what (and if) the prepayment penalty is on a HELOC. In years past the penalties were substantial and covered quite a few years-I remember getting snagged by Band of America for $500 prepayment penalty when I closed out an unused HELOC that was 3-4 years old back in the early 2000's.

If you do close out your HELOC make sure it gets released on the land records NOW. In all likelihood you will have to pay the recording fee (over $50 in my state). If you wait until you need clear title (like when you sell or refinance the house that could add a lot of delay, headaches and expense-especially if the lender has merged/gone out of business.

 

[cronos]

I'm sure everyone has a stack of CC and business cards lying around. Just put them together in a drawer and leave them. I still have one open from '95 when I started college but haven't used in over a decade.

Used to work this way but may not anymore. These days with even only one year inactivity the card issuer just simply canceled the card, sometimes without even warning you. This is why I keep track of last usage date of all my cards, making sure that they're used once in a while. I learned this the hard way with two of my cards canceled when I was about to use them.

 

[highland145]

Make sure you check what (and if) the prepayment penalty is on a HELOC. In years past the penalties were substantial and covered quite a few years-I remember getting snagged by Band of America for $500 prepayment penalty when I closed out an unused HELOC that was 3-4 years old back in the early 2000's.

If you do close out your HELOC make sure it gets released on the land records NOW. In all likelihood you will have to pay the recording fee (over $50 in my state). If you wait until you need clear title (like when you sell or refinance the house that could add a lot of delay, headaches and expense-especially if the lender has merged/gone out of business.

Here, they're treated like a revolving account. Need $1000, fine. Need $5000 more, fine up to your limit. So it's not like the typical 2nd mortgage where you get X amount of $$. Can't remember if the new heloc is 1% of the balance/mo or just the interest payment.

And eff BofA. That sounds like the typical crap they do. Charging you for closing an unused account.

Talking with a guy last week that was involved in getting a loan that tied up several properties. Bank called and said he already had 2 liens on one of them. He didn't. Oops.

Did I mention eff BofA?

 

[Thump553]

highland145: The way you described it is the way most, if not all, HELOCs work-as an open revolving account. Back when I had mine all the lenders (not just BofA) charged prepayment penalties if you closed out the account within the first couple of years, even if you had a zero balance. I think those prepayment penalties aren't as bad now, but no way I would enter into a HELOC without asking questions and reading the loan docs first.

Your friend with the two open liens-odds are great he didn't record the releases. Hopefully he still has them, if not he has to make calls now and keep making them until he gets the releases.

 

[highland145]

He's getting them straight. Expected the banks to take care of it which is what should have happened and the average person expects.

Some years back, my mortgage company paid the property tax on one of my rentals. Tax I had already paid. Glad I followed up.