Does it really make your credit score go up if you pay off a credit card and close it? If so, how many points does it go up and does it matter how long you have had the card?
2006-10-21 16:42:34 · 4 answers · asked by love my life 2 in Business & Finance ➔ Personal Finance
Hello Happy Girl.
Paying off a credit card doesn't increase your credit score. Your credit score is derived from how well you pay your monthly payments. It doesn't matter if you pay in full each month or make the minimum payment. As long as you pay as agreed, your credit score will increase.
2006-10-21 16:55:39 · answer #1 · answered by beachbum72 2 · 0⤊ 0⤋
The last thing you want to do is open multiple credit card lines. Your credit score is hurt by leaving accounts open due to vulnerability to assess new debt from open credit. Close accounts you aren't using. Also limit the amount of credit you open to less than 6 any more will lower your score. Paying your credit card in full keeps your credit in good standing, but the best way to build your credit is to leave a small balance such as 5 dollars, and get charged the small finance charge. This shows you can make multiple payments on a debt occured, rather than paying in full which does not keep you in debt. Remember credit is not bad it's the misuse of credit!
2006-10-22 01:21:02 · answer #2 · answered by Nate 2 · 0⤊ 0⤋
Pay off your credit card every month in full. You will avoid paying too much for your things, and your credit score will always be great.
DO NOT cancel a card. It shows up as a cancellation, and can be detrimental. You can cut up the card, so you don't use it anymore.
2006-10-21 23:49:28 · answer #3 · answered by Lion J 3 · 0⤊ 0⤋
Part of your score is the ratio of credit used to available credit. Closing a paid off account drives that ratio up, which can lower your credit score. As long as there is no annual fee, just leave the account open.
2006-10-22 00:43:32 · answer #4 · answered by Bostonian In MO 7 · 0⤊ 0⤋