Credit cards have all kinds of rewards these days. I already have a few cards that I've had open with good credit for several years. What is the effect on my credit of opening up a new credit card, getting some reward for my first purchase, and then closing the account?
2006-07-02 12:30:24 · 6 answers · asked by Matt S 2 in Business & Finance ➔ Credit
You will receive a ding on your report for applying for the card. But after around 6 months that will have less effect on your scores.
Depending on how long you have that account will determine how much of a ding you will take in closing it. If it is a recent card, probably not much.
Also, depending on who you have the account with, if you charge on it to get the rewards than close it, you may have trouble getting approved with them again. That probably won't happen, but you never know.
Unless you are paying a fee on the card, why not just keep it sock drawered and pull it out once a year or so and buy a tank of gas on it, pay in full when you get the statement. Put it back in the drawer for another year. Let it work for you in by raising your credit scores as it ages.
2006-07-02 12:46:15 · answer #1 · answered by echo 7 · 0⤊ 0⤋
If this is the only one you are applying for, it may be worth it for a substantial reward. A few points should come off of your credit score temporarily, but it would likely rebound in less than a year.
Only about 100 people in the world could tell you exactly what the result would be.
Keep in mind the purpose of good credit is to save you money on loans. If you have the opportunity to collect without resulting in long-term credit damage, sounds like a pretty good option. I would refrain if you are preparing for a home or car loan in the next 6 months.
2006-07-03 02:29:48 · answer #2 · answered by Anonymous · 0⤊ 0⤋
That is good and kinda of bad but still it gives your credit scores points, what it does is boost your scores a couple of points for instance if you were buying a house and your score was 578 and you needed two points to get to 580 that is the rate for 100 % financing then the couple of points would help you out. so you see how it works leaving it open for two months can boost your points by two times the rate on your scores.
2006-07-02 16:02:08 · answer #3 · answered by Anonymous · 0⤊ 0⤋
You have taken the "hit" of opening a new account. Paying it off immediately did not give the account a chance to earn positive points for a "current" rating
2006-07-02 12:35:55 · answer #4 · answered by nickdmd 3 · 0⤊ 0⤋
they take points off everytime some one runs your account of a new card. u got the card so i think u are good
2006-07-02 12:35:56 · answer #5 · answered by prettygurl 1 · 0⤊ 0⤋
That may lower your credit score
2006-07-02 12:37:50 · answer #6 · answered by Larry 1 · 0⤊ 0⤋