Revolving credit accounts - Should I close unused accounts?

[RaiderJ]

Looking into buying a house sometime this year, and I'd like to improve my credit rating as much as possible by then.

I have some credit cards with a zero balance that I'm not using - would it help to close them down, or help by keeping them open? My balance vs max limit on all my accounts is right at 30%, and I've heard that keeping accounts open to keep that ratio down is helpful to my credit rating. Should I close down accounts as I pay off the balances to keep my ratio at less than 1/3?

Any other suggestions?

 

[woowoo]

Keep them open

 

I would close any accounts that are good and not being used, just to lower the risk of anything bad, like hackers, getting into them.

 

[Queasy]

You shouldn't have anymore than 3 or 4 revolving accounts. Keep the oldest ones if possible.

 

[PingSpike]

If you're going to close them, which if you have a lot may be a good idea...close the newer ones. Age of credit is a factor in the score so older accounts are better.

 

[frankie38]

keep them open and increase the credit lines.

 

[dullard]

Since your CC balance is so high, definately keep all accounts open. Your credit rating will likely fall noticibly if you close them. The best solution of course is to pay off the balances and then this won't have to be an issue.

Once your CC balance is zero, you can read the rest of this post.

Keeping accounts open can potentially harm you, but the chance of a problem is very slim. Thus if you know you will never use an account, you can keep it open if you've had it longer than your average account. If you close it in that case, it will lower your average account history length and thus will likely harm your credit rating.

However, if it is a new account that you will never use, then you can close it. That will actually increase the average length you've had each account. This is a seldom thought about case where closing an account may help your credit rating.

 

[DaWhim]

4 credit score myths

 

[RaiderJ]

Originally posted by: frankie38
keep them open and increase the credit lines.

I've been doing that and calling every six months or so to see if I'm eligible for increases and rate reductions - is there a point where it shouldn't be done?

For the record, I have a Sam's Club account, a VISA, MC, AMEX and DISC credit lines, plus an overdraft line with my bank. Too much?

 

[RaymondY]

I would close all revolving accounts that you don't use especially the newer stuff. If you haven't used the accounts for over 1 year, kill them too!!!

 

[RaiderJ]

Originally posted by: DaWhim
4 credit score myths

:thumbsup:

 

[frankie38]

good going. banks look at your total credit lines. they evaluate the quality of the lending institution (ie are they conservative lenders) , credit line utilization (credit used/tot credit line), and of course are you making the payments.

Yes, there is a limit to the number of accounts/cards/lines. you are no where near that.

Your credit credentials are impressive!

 

[dirtboy]

Originally posted by: frankie38
keep them open and increase the credit lines.

This is the correct answer.

 

[dirtboy]

Originally posted by: RaiderJ

Originally posted by: frankie38
keep them open and increase the credit lines.

I've been doing that and calling every six months or so to see if I'm eligible for increases and rate reductions - is there a point where it shouldn't be done?

For the record, I have a Sam's Club account, a VISA, MC, AMEX and DISC credit lines, plus an overdraft line with my bank. Too much?

You're fine.

 

[DaWhim]

Originally posted by: RaiderJ

Originally posted by: frankie38
keep them open and increase the credit lines.

I've been doing that and calling every six months or so to see if I'm eligible for increases and rate reductions - is there a point where it shouldn't be done?

there is a line there. if they are doing a hard pull on your credit report to see if you are qualified for the increase of LOC, don't do it. soft pull is ok. call up citi and ask the rep, make sure you tell them check if you can get an increase without pulling your credit report at all.

 

[RaiderJ]

Originally posted by: DaWhim

Originally posted by: RaiderJ

Originally posted by: frankie38
keep them open and increase the credit lines.

I've been doing that and calling every six months or so to see if I'm eligible for increases and rate reductions - is there a point where it shouldn't be done?

there is a line there. if they are doing a hard pull on your credit report to see if you are qualified for the increase of LOC, don't do it. soft pull is ok. call up citi and ask the rep, make sure you tell them check if you can get an increase without pulling your credit report at all.

Yup, I've been going for the "pre-qualified" increases. Usually around $250-1000 at a time.

 

[aplefka]

Originally posted by: DaWhim
4 credit score myths

Good article