Does it help your credit score to close an unused credit card?

Question

Is it better to have several unused cards open or is it better to close a card when you no longer have a balance?

Answer 1

You always want to keep open your card(s) that have been open the longest, regardless of whether you use them or not. Part of your credit score is determined by the length of your credit history. Another big part of your score is determined by your overall credit limit vs debt outstanding--and closing your cards means you're lowering your limit.

So unless you just have like 20 cards lying around unused, I would just cut them up and not close the accounts.

Answer 2

It is a crapshoot because it really just depends, a lot of lenders will say just to leave the credit card open because then if you were to buy a home the lenders would see the credit history you have with that card and see how you have not abused the credit card. With this the lender will see you as a fiscally responsible person but then again sometimes lenders do not want to see a lot of available credit, for example if you make $50,000 a year and have like $150,000 in available credit in all your cards, they might not like that. If you really want to get rid of a card, try to find the newest card and has the lowest available credit.

Answer 3

Yes it does because one thing that your credit score takes into account is your potential of revolving balances. So even if you have a credit card with no balance you have the potential to charge it up and that affects you debt/income ratio and your credit score. I would advise closing unused accounts.

Answer 4

no. it does not help your credit score to close an unused credit card. It's helps to leave it open.

BUT, only leave it open if you can stay away from using the card. If you will give in to temptation and use the card then close it.

Answer 5

It greatly depends. You dont want tons and tons of accounts open. You can check your credit score and it gives you reasons-- if it says, "Too many revolving or consumer accounts" then you have too many. Otherwise dont worry about it.

What you do want is:
1) LONG TERM accounts (long average history-- so closing old accounts can hurt
2) LOW utilization ratio (low balance vs limit-- so closing accounts with available credit can higher your overall ratio if you have other accounts with balanes.