that have higher limits but we also want to pay them off. My question is should I keep the credit card open with a $0 balance or close it. I dont want to much credit on me because me and my wife are about to buy a house
2006-11-03 01:39:05 · 7 answers · asked by Jeremy D 2 in Business & Finance ➔ Credit
Your credit is generally based (in part) on how much credit you have available to you (i.e. how much money you can access via credit). Because of this, having more accounts generally raises your credit. However, if you have LOTS of cards, some banks will feel you have "too much" credit. It depends on how many accounts you have open. If it's 5 or less, I would leave it open (as long as you won't use it and rack up more debt. If you it may pose a problem in that you might be tempted to use the card, then close the account.)
2006-11-03 01:44:22 · answer #1 · answered by Phoenix, Wise Guru 7 · 0⤊ 0⤋
You will want to keep the credit card account open for two reasons. The first being when someone pulls your credit it instantly uses an equation to figure your score based on several different things. One of which is how much available credit you have as compared to the amount you are using. So having an open $500 account and not using it shows that you are managing your credit wisely. Also they look for longevity of accounts. How long have they been open and the payment history. So having older accounts helps you as well. So by paying it off and having it not being used it will be a win win situation. The old school way of thinking was to have everything closed out as soon as you pay it off but that could not be any further from the truth. Hope this helps.
2006-11-03 01:48:00 · answer #2 · answered by Cam 2 · 0⤊ 0⤋
Once you pay the card off, keep it open with a zero balance.. it will hurt your credit a little bit if you close it, and especially since you don't have much credit, I would definitly say it's best to pay it off and keep it. Plus, that way you'll have it in case of an emergency as well. Good luck with the house!
2006-11-03 01:43:15 · answer #3 · answered by Anonymous · 0⤊ 0⤋
Keep it open until you buy, than close it.
It gives you a little higher score on FICA.
Not much, but maybe a .01 on your loan.
But everything helps.
Go for a fixed rate 15 year loan if you can.
Payments are higher, but you will save a ton of money in interest.
Dave
2006-11-03 01:50:01 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Close it. If you have others you don't need it, and most credit cards have a yearly fee which is just a waste of money if you're not using it.
2006-11-03 01:43:52 · answer #5 · answered by Kellie 1 · 0⤊ 0⤋
You can actually hurt your score by closing the card because you will be lowering your average age of your open accounts.
2006-11-03 13:35:29 · answer #6 · answered by Mariposa 7 · 0⤊ 0⤋
close it, its best to have as few credit cards as possible
2006-11-03 01:47:00 · answer #7 · answered by Anonymous · 0⤊ 0⤋