Does it hurt or help your credit to have several open credit cards with no balance?

Question

Or would it be better to close some of them?

Overall, my credit rating is pretty good. . .I'd just like to improve what I can.

Answer 1

It is often said that closing unused credit card accounts will help improve one's credit score. This is not true. In fact, closing accounts can result in either no increase in score or even a lower score. Closing an account cannot improve your score. A few points to note:

1) Closing an account will not remove it from your credit report. The payment history on closed accounts will continue to be displayed and considered in the calculation of your credit score.

2) An important factor in your credit score looks at how much of the credit that’s available to you has been used. Here the score calculates the proportion of total balances to total available credit, with the lower the proportion, the higher the score. When you close an account, the amount of available credit is reduced, which could result in a higher proportion of balances to available credit, and lower your score.

3) If you received a Negative Factor with your credit score indicating you have “too many bankcards,” do not close a bankcard account for the purpose of raising your score. This Negative Factor simply refers to the number of bankcards on file and does not consider whether they are open or closed.

This is according to the information found on FICO's own website. As you can see you want to take the ratio of balances to available credit. Try to look at which way would give you the lowest ratio based on the accounts you have open and if you were to close specific accounts. As a former financial counselor, to see a consumer being responsible with credit, is worth a thumb's up! I hope I was able to help.

Answer 2

"Length of Credit History" is 15% of your fico ranking. Leave the oldest card open except it has an annual rate. An annual rate is by no means valued at this. Turn your pondering round. For principal purchases use your financial savings account. Not bank cards. Use a card for day after day matters reminiscent of fuel and pay in complete every month while you get the invoice within the mail. This continues credit score "alive". By paying in complete you by no means pay curiosity and also you broaden fine credit score. Just make certain you get a declaration that claims $zero first. Often occasions, after wearing balances you are going to get an extra invoice with "left over curiosity". A bank card is a unfastened technique to preserve fine credit score. Just by no means dare convey balances.

Answer 3

Open cards can have a negative impact because shows lenders that are looking at your report that you have lots of open credit and at any time can get into debt. The more you have open the more money you have the potential to get in debt. As long as your balance is alot higher than what you owe, that can be a good thing.

Answer 4

It depends on what kind of loan, etc you are trying to get. It's good in terms of your debit to credit ratio but some lenders may look at it in that you have TOO much available credit and could easily go overboard. Generally it's best to only have one - maybe 2 credit cards and no store cards.

Answer 5

not at all, But having balances close to the max of your credit limit does hurts you. Having a little of debt and paying it off actually helps your credit scores because it shows you know how to maintain your debt and pay it off on time.

Answer 6

If there is no balance on the cards then it can't help your credit score.

Answer 7

yes your credit score is based on credit available to you(open acct) and the total amount still available (no balance/low balance)

Answer 8

It hurts it, cancel the ones you don't use with no balance!

Answer 9

i would close some b/c companies will see that you could possibly run them all up at once and go bankrupt-you wouldn't, but others have