If my credit cards gets cancelled due to inactivity, will that effect my credit ranking?

Question

One of my credit cards just got cancelled because I haven't used it in about a year. Is this bad for my credit? I mean I had $0 balance on it and everything.

Answer 1

It's better for your credit rating to have the card cancelled. The fewer credit cards, the better. Open card accounts count against you.

Answer 2

Your scores will probably take a slight dip for awhile.

The advice that the fewer cards the better and open accounts count against you is totally wrong.

If you do not have a healthy balance of credit on your reports - guess what - you pay a higher interest rate when you purchase a home, a vehicle etc.

You actually need a good mixture of major credit cards, store cards and loans on your reports. Keep in mind that your utilization should remain low.

The only time you should run up a card is when you are not planning on applying for credit for a couple of months. Allow the balance to hit your reports then pay in full. AND of course, ONLY if you can afford to do that!!!!

For instance, you have a card with a $400.00 limit, charge it up between $100. to $200. , as soon as the statement cuts, pay in full.

That way you are showing whoever you are applying for credit with that you can handle your finances, that you are using your available credit and you are using it wisely.

If I were you, I would call the credit card company and request that they re-open the card.

Use your cards roughly about every 6 months, even if it is just to buy a tank of gas or a pack of gum.

Then pay in full and stick the card in your sock drawer.

Answer 3

I have NEVER in my life heard of a credit card issuer cancelling a person's credit card. I have a Discover Card that was inactive for ove 1 1/2 years, so I decided to cancel it., and Discover spent a lot of time on the phone to try and get me to keeps the card. They even offered incentives for me to keep it. This has also happened with a VISA card I cancelled.
If you have no debts owed to this credit card company, you credit rating will be UNAFFECTED.

Answer 4

Not sure why they would cancel your credit card, but if you don't owe, continue to use it. Charge a very very small amount on it...at least 25%.....then pay it off..keep doing that for about 3 - 6 months. It will help your score too.

Answer 5

Cancelling in itself will not effect it. The card has already on your account, but because of low or no activity, it really doesn't effect the score unless it had a high balance at one time and was paid on time.

Answer 6

Wow- that's messed up. Yes- it will affect your credit in a couple ways- since you have less of a credit limit your debt to credit ratio will go up (which is bad). Also, if the card issuer states 'card closed at bank's request' instead of customer's request, that could look bad to lenders.

Answer 7

It does lower you score when a company cancels an account. It is better for it to say consumer canceled on your credit report.

Answer 8

I doubt it its bad for your credit, but just to be safe, call them and make sure it states there why the account was closed, and check your credit rating at freecreditrating.com to see how its affecting your score. You can also always dispiute with the credit bureaus. Hope this helps.

Answer 9

It shouldn't, but you should get a copy of your credit report to make sure the accounts are technically closed. Having an open account, even and unused one, effects your credit score.

Answer 10

yes companys like to see that you spend money and that you keep a small balance but you pay it off i belive the best way to get you score up is to keep your balance at a 1/3rd of your total credit line even if you say pay your electric bill on your card every month then when your bill come in pay it off.