or How much can it affect my credit score if I cancel a credit card?
2006-11-05 02:38:43 · 5 answers · asked by M.Puzo 1 in Business & Finance ➔ Credit
It depends on your total credit available. You want leave 50% or more of your credit line open. For example, you have two cards with limit of $1,000 each. If you have $500 balance on one and $0 on the other, you currently have 75% credit line open. If you cancel one card, you will have 50% open. That will affect your score somehow. If you have ample credit line, it won't matter.
2006-11-05 02:45:15 · answer #1 · answered by spot 5 · 0⤊ 0⤋
It is variable. It can actually INCREASE your score if your 'debt to income' is reduced. Just canceling a credit card, however, won't do much to raise or lower your score.
You credit score is determined by many things... most of which is your history of making payments on time and in accordance with the agreement you signed when you took out a loan or signed up for a credit card. But it is also affected by making applications for credit (inquiries) and by how much debt you have compared to how much money you earn.
2006-11-05 02:50:40 · answer #2 · answered by paleblueshoe 4 · 1⤊ 0⤋
LOL...I guess you add my answer to the "it depends" group.
Generally, it will hurt your score when you cancel a card. You lose a portion of your credit history, which is a major factor in calculating your credit score.
Also, you lower your debt/credit ratio by eliminating a portion of your credit limits.
If we are only talking about one card, and you have other sources of active credit, your score will rebound in a couple of months. But I would consider keeping the card. Maybe get the credit limit lowered if that is the issue.
2006-11-05 07:57:45 · answer #3 · answered by Anonymous · 0⤊ 0⤋
There's no exact answer since the credit scores are comprised from very complex formulas which account for many variables. By cancelling your card, you will be making you average age of your open accounts lower.
2006-11-05 04:50:09 · answer #4 · answered by Mariposa 7 · 0⤊ 0⤋
It really depends on a lot of factors.
Potentially it could drop it significantly 40-100 points.
Keep it open.
Here is a good article about how credit is scored: http://www.expert-credit-advice.com/credit_score.htm
2006-11-05 02:44:29 · answer #5 · answered by Anonymous · 0⤊ 0⤋