Do closing credit cards lower credit score?

Question

I have over 10 credit cards with a credit line of about 100K. I pay all my bills on time. I have no balances on my credit cards. I have an excellent credit score of 820.

But I am tired of taking care of so many cards and I want to close most of them; may be keep about 4-5. Would this lower my credit score?

Please reply only if you have a definite knowledge about the subject. No guesswork or opinions please.

I am planning to buy a new house in about 6 months and I like to be on the right track, as far as possible. Thanks.

Answer 1

I recently closed one and the person who was dealing with my account told me specifically that it will affect my credit score negatively (Visa). I did my own search and most people seem to think that it actually affects your credit score in a positive way. Personally, I closed the card anyway because I believe it makes you look more responsible when you don't have half a dozen cards with balances on each.

Answer 2

Closing accounts does affect your score-good or bad no one can tell you that. I can't answer definitely nor can most people since we don't work for FICO and FICO doesn't let out their exact formulas to the public, but I do know that closing accounts will affect your score. Good or bad, again who knows. Most likely adversely if the accounts are older.

If you are planning to buy I would consult a mortgage broker or your bank to find out what they think is the best thing to do, but keep in mind they can't know for sure what will happen either, but they can give you opinions.

You say you have no balances on any cards and excellent score, why are you tired of taking care of them-what's to take care of if there is no balance? If you feel you MUST close accounts, I would recommend closing the NEWEST accounts, since that won't affect your length of history. Length of time is more important than how many accounts. As long as you have a good mix of credit accounts, ie credit, charge, installment loans and revolving accounts your history would still be stellar with an 820 score.

Other recommendation would be just put them in a lock box until after you buy your house and then you can close them without it mattering much.

Best of luck!

Answer 3

First if your going to buy a home, then go talk with your morgage lender... because depending on where ur financing it can have a affect. Not alot but some. You want to figure out wheither your ready to buy, how much house can u buy, and to see wheither what you figured matches the bank or lending instituion criteria (formula). They also usually offer some good material to help with the process.

Your correct in that you don't want to have all these cards open, as far as mangement. But you could place them in safe, safe deposit box for safe keeping. Put a do not solicit on each one from the credit card company.

When u close something, make sure the credit history overall will not affect or lower your score. Because credit card companies do get PO when u close something fairly new. Usually when ur shopping for morgage it (credit score) will lower slightly from all the inquiries... you just try to get the inquiries close together so that the bankers or morgage lenders realize it's only competition for the note.

Good luck on new home.

Answer 4

Closing Credit Card Accounts is Unhealthy for Your Credit!

Closing credit card accounts is a fast track to lowering your FICO credit scores.

Here's why...one of the categories that makes up your FICO credit scores is called "time in file."

In English, "time in file" translates to:

•How old the oldest account on your credit report is
•The average age of all the accounts on your credit report

The longer you have the same accounts the better it will be for your FICO credit scores. (And it is in your favor if those accounts are in good standing.)

I've had the opportunity to study a few credit reports where the consumer obtained FICO credit scores of over 800 (like you).

These folks are like the white buffalo. They're very rare and rank in the top 5.85% nationally. This means their credit scores are higher than 94.15% of the rest of the people in the country.

One thing the, "800 Club" members all have in common are several old accounts appearing on their personal credit reports…decades old in some cases.

Bottom line: an old credit history is good for your credit scores. And you can't achieve an old history if you close your accounts.

Answer 5

Closing accounts can hurt your score. It's because your score is based on several different things, with one of them being length the accounts have been open. I would suggest waiting to close the accounts until after you buy the house. Or, cut the card up, but keep the account open.

Answer 6

It could lower your score since you have less available credit available to you and you will be shortening the average credit age of your accounts since the age is based on the length of time the accounts are open and active.

Answer 7

Actually closing accounts can raise your score because you would be lowering the amount of credit available to you. And if there were paid off balances on the accounts you would be lowering your debt to income ratio as well.

Answer 8

Yes, the score desreases, so you'd better keep them. But since you feel sick of paying them out, leave those with no annual fee.

Answer 9

No it shouldn't lower your score...only negative credit reports from not paying bills on time and credit inquireys lower scores...the silver bullet that will kill your score is a late mortgage payment..