Will Canceling DELL Preferred Account Card hurt my credit ???

Question

I signed up for a Dell card about a year ago and bought a laptop with it. I have paid off the laptop already and I no longer have any use for this Dll card as I don't see myself buying anything else from Dell in the future. Will it affect my credit score negatively if I were to cancel it? I really dont want it because it is an extra charge account that I don't use and potential exposure to credit fraudulant.

Answer 1

Closing existing accounts can hurt your credit.

Since the account is only a year old, you shouldn't take much of a hit on that.
If you have any loans or credit card balances, you would be raising your overall utilization by losing the Dell credit limit, which will hurt.

I usually say it is best to just keep paid off cards open, and placed somewhere safe, to allow the account to continue to work for you by increasing your scores - but, with Dell, I would say go ahead and close it even though you will probably take a hit on your scores.

My reasons for saying close it is because Dell is notorious for closing accounts after a major purchase is paid off.

Either way it will probably be closed, so it would look better on your reports to have it shown as closed by consumer rather than closed by creditor.

Answer 2

Here is why canceling cards can hurt your score, surprisingly. Your credit score, aside from on-time bill payments, is based on two other variables: your income to debt ratio and your debt to credit available ratio. In this case, if you cancel the cards, let's say each card is granting you at least a $5,000 credit limit, you are decreasing your available credit by almost $15,000 while your other debts stay the same. If on that last card you have it maxed out (which you say you don't, but for example), then yeah this would reflect badly. If though you can get rid of the balance on your fourth card, maybe even ask the card company to raise your limit if you're thinking of keeping it and you qualify, then slowly cancel the other 3 cards one at a time, this might put you in better shape. Still, the fact you had nearly 4 credit cards on your record is going to bite you a bit eventually, but credit does heal with time. If you haven't seen your credit report in a while, I would try making sure you have no credit card debt and cancel one of them. Then a month later, check your credit report (you can get a credit report for free once a year). See where it falls. Anything above 650 is considered a great score, so if you're above that, I'd think you'd be fine to get rid of the others too.

Answer 3

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RE:
Will Canceling DELL Preferred Account Card hurt my credit ???
I signed up for a Dell card about a year ago and bought a laptop with it. I have paid off the laptop already and I no longer have any use for this Dll card as I don't see myself buying anything else from Dell in the future. Will it affect my credit score negatively if I were to cancel it? I...

Answer 4

Your credit score is based on many factors. One of those is how long you have had credit. The longer an account is used, the better. However, if you have too many open accounts--even not being used, this can be used against you too. If you are diligent about paying your bills on time and not getting in over your head with credit, I would say that you need to do what you feel right about doing. It won't be that big of a deal in the long run.

Answer 5

Since it hasn't been open very long, it won't hurt your credit. An example of something that could hurt your credit is if you had a credit card that you used monthly and paid the balance off monthly that was open for years and you decide to switch to a new credit card and cancel that old one.

Answer 6

My Preferred Account

Answer 7

usually not as long as it's paid off. But the more open credit accounts you have, and are making on time payments on the better it will do for your credit. That is as longas you don't have too many.

Answer 8

It probably will improve your credit rating as you will have fewer open accounts.

Answer 9

yeah if its paid in full, then close it..
one thing u can do is keep it open for awhile and don't use it and it can help your score.