Does your credit score get whacked if you cancel credit cards?

Answer 1

It depends on what you mean by "whacked" ...it does tend to get "dinged."

The problem tends to be that people INCREASE their balance-to-limit ratio because the combined credit limit is lowered and the amount owed remains the same. This increase leads to a lower score. ("Balance and burden" accounts for 30% of your FICO score.)

The other problem is that the length of your credit report may shrink. The two main factors that account for 15% of your credit score are age of your oldest account and the average age of all accounts.

Generally, the damage was done by opening the cards. It's best to let them remain idle or only use them once every now and then (and pay off in full and on time) in order to preserve your score.

BUT, if these cards are a temptation to overspend, by all means cut them up... again, don't close them. If your lender doesn't like how much available credit you have and suggests that you cancel some cards, you could just call your card companies and lower the credit limits and that would generally make your lender just as happy without killing your credit history.

I hope this helps!

Answer 2

I noticed several other answers referred to "ending" a good line of credit. This is not the case. Just because you cancel a credit card, that company does not cease reporting your credit rating. It should still be reported for some time after you cancel it. If anything your score will improve because you have lowered your "potential indebtedness" meaning that you have reduced the amount that you can rack up in bills without being re-qualified.

Answer 3

YES, it does if you are wanting to cancel your cards don't for awhile let them sit unused with no balance, when you cancel your credit cards it lowers your amount of available credit which in most cases with lower your credit score if they are cards that don't have annual fees then just cut them up and don't use them you won't charged anything and then when you have paid down a loan on either your car or your house them you can cancel them because you have increased credit (equity) on those and that will ofset what closing your credit cards will do to your score. If the balances are completely paid off them I would want about 6 months to a year before you close them.

Answer 4

Credit bureaus like to see a good history of credit on multiple accounts. By cancelling an account, you are cutting off the good history.

This will hurt your score.

Answer 5

It depends:

Is this the only credit you have (then the answer is yes)

If you have more then 25K of available credit and you closed one that only affects you by 5K then I would say no.(to much credit is not good too)

Answer 6

Who cares? Playing with credit cards is like playing playing with snakes - sooner or later you'll get bit. Don't worry about your "get into debt" score - focus on paying off the debts and saving and paying with cash, then you won't need a credit score.

Answer 7

Not at all. As long as you pay your debts and keep some type of ongoing payments in place. If home owner that is key to strong credit with current payments and no being late.