I have a lot of credit cards. My question is If I close some of my credit cards does it lower my credit score?

Question

I have a lot of credit cards. My question is If I close some of my credit cards does it lower my credit score?

Answer 1

Yes it will. The credit experts say that you've done the damage by opening the accounts so make them work for you. Pay them down to 0 balances and file them away. The credit cards show your payment history and credit limits. If you close them out the payment history is gone. If you re-apply for new credit the creditors don't have much to fall back on to check and see if payments were made on time. Regarding the credit limits most lenders take your monthly debts divided by your credit limits. For example if your credit debt is $1,000 and all your credit card limits combines are $6,000 your debt ratios are 17% which is well below the 50%. That's a good thing. Even with a credit card if you can use less then half of the credit limit that's a plus. That's why it's always good when creditors want to increase your credit limits. So make those credit cards work for you, but DON'T CLOSE THEM OUT. :)

Answer 2

It could, yes, because it lowers the amount of credit available to you and takes away credit history for those accounts. Other things that lower a credit score are multiple inquiries, opening NEW credit, having late payments or missing payments, etc.

Check the information on
http://en.wikipedia.org/wiki/Credit_score
for a good overall definition of the credit score process. Having said that though, if you can, eliminating debt is always a good thing though. Pay off and pay down as much as possible but you need not close the account.

Answer 3

If your credit limit on the JCP is still only $500 after 13 years, you seem to be doing something wrong - like not using it. Never known an annual fee on a conventional Mastercard or Visa card unless it is a credit builder card. You should pay off and close the Best Buy, Walmart, Visa Target and JCP. That will leave you with three cards which is quite enough for the average person. Cards used regular with monthly payments always paid on time usually get credit limit increases. The lack of such increases in your case indicates non-use

Answer 4

It depends on the type of credit you are looking for. House lenders look at different things than do car lenders than do credit card issuers.

I have heard, however, that the older your credit is, the better your credit score will be. Lenders tend to like long, successful relationships.

Also, the more open credit you have (unused credit), the better your score is.

Yet another thing to consider is how much credit you have over how many cards... the lower average per card you have, the lower your score would be.

Hope that helps!

Answer 5

The temptations to own a new credit card are so numerous in modern times that many of us end up with a purse-full of them without any real need. They stay there and cause a lot of problems in repayment. The confusion that comes with too many credit cards can easy lead to a missed payment and resulting penalties. Frequent defaults will reflect poorly on your credit score. So, keep only the necessary and discard the rest. Read more from: http://www.credit-card-gallery.com/article/239,Credit_score_repair_in_5_simple_steps

Answer 6

I heard that it lowers your credit score, but not by much though. The reason for that is that if you close your credit cards, others will see it as you not being able to handle your debt. And I think the whole point of getting credit cards is to build credit (which ultimately means you have to owe money and be able to repay it). If you have credit cards lying around that you don't use, there isn't much that that credit card is doing to improve your credit.

Answer 7

I am not sure if it lowers your credit score but I do know the longer you have an account open, the better your credit looks. So you don't have to use the card just let it marinate ;o)

Answer 8

Actually, it improves your credit score. Creditors not only look at how well you handle your credit, but at how many credit cards you have open. I'm not sure why having less credit cards would improve your score, but I've been told that it does. Maybe it's because if you have a lot of credit cards, it looks like you're trying to spread your debt too much, meaning you are more likely to incur a lot of debt, thereby making you more of a credit risk.

Answer 9

No, it will probably improve it, but not if you churn your cards by constantly moving balances. Once upon a time, people had many different credit accounts - at the lumber yard, clothing store, florist - which have all been subsummed into plastic cards. Having too many means you have the potential of running up a lot of debt on various cards even if you don't have it now. Your rating is how you use credit, not how much you can draw down.

Answer 10

The more credit cards you own the lower your rating. Reason being simple as that you are considered a risk. By having open credit and you fail to make payments or pay the sums of money back in time the more the bank(s) looks at you as a risk of them losing money.