Is FICO score or the credit score affected when I open and close credit cards?

Answer 1

Yes scores are affected by opening and closing credit cards.

When you open cards, you will take a small hit for the inquiry. Generally the hit can range from a couple points up to 7 points, sometimes more - but that is rare.
The inq's will start to lose their negative impact in 6 months and by one year have no effect at all. (to the creditors who look at your reports)

Then when an account is opened, how it will affect your scores depending on how thin your files are. If your credit reports are pretty thin, the new accounts will drop your scores for several months. But if you keep the accounts in good standing, you scores will rebound probably higher than where you were before you applied and received the card.

As for the closing of cards, the older the card and the higher the credit limit is will hurt the worst if closed. You would be losing age and also losing utilization by closing the card.

If you are not paying a yearly or monthly fee on the card, just leave it open and put it in a drawer. Pull it out every 6 months or so and make a small purchase, pay in full when you get the statement and put it back in the drawer for another 6 months.

If it is a major credit card - go to McDonalds and buy a burger. If it is a store card, buy a pair of socks or something cheap.

If the card has a fee that you no longer want to pay, then close it. No sense in paying that fee. Just be sure to replace the card with a no-fee card before you close it.

Just because you have the cards does not mean that you constantly have to use them. Once or twice a year for small purchases will keep the cards open and as long as you pay timely, the cards will help your scores.

Answer 2

For a breakdown of your fico score check out http://creditwisdom.blogspot.com/2006/09/fico-breakdown-how-your-credit-score.html
Always think twice before closing your oldest account because it can make your credit history appear shorter than it really is. Opening alot of accounts isn't the bad part it's applying for alot of new credit.

Answer 3

Yes. Everytime you open an account your credit gets checked which lowers your FICO. Paying off cards in full and closing the account will increase. Best to have 1-2 cards and keep them under 40% used.

Michael
http://www.webmasterautomation.com/blog/

Answer 4

Oh yeah it is, also EVERY single time someone even checks your credit score! Every credit card you even have opened affects your score as well, I know it is so weird, but they figure if you have an open line for a million then it is possible for you to go hog wild and use a million so they use it against you....