Should I cancel 2 small credit cards with zero balances to improve my score?

Question

My Financial Advisor said to cancel my Express and Vict. Secrets cards that I paid off- they only have 600 limit- I have 9000 on AMEX limit and 5000 on BOA visa- Macys credit of 700.00; Nordstrom- 500.00 - another visa-300.00 limit- ALL CARDS ARE PAID UP TO DATE- what should I cancel if any as I may want to get mortgage this fall-

Answer 1

Your credit score, in part, is based on how long you have had credit (each one separately) and what percent your debt is to total credit limit. Even if you pay your credit card in full each month, when they check, they will go by the balance on that particular date. If you just charged $500 on a limit of $600, that is bad; if you charged $500 on a limit of $9,000, that is good. But it is not just an individual card; it is also all of them together.
First question: do you pay fees to hold any of these cards? If so, get rid of it. There are too many out there that don't charge an annual fee.
Second question: do you get cash back? Discover, State Farm Visa and others pay you cash back. (I always pay in full each month! That alone helps your credit score.)
Third question: which cards do you NOT need? Let's face it, a person seldom has a need for a store card. Visa, Master Card and Discover are accepted (almost) everywhere. If you have Visa and either M/C or Disc, that's all you need. Of course, Sears and J.C. Penney have some sales where they give an additional percent off if you use their card, but is it worth it?
One old trick: have the money on hand, borrow money from a bank, then pay it off in a short time. That usually bumps credit scores up.

Answer 2

Whether or not your credit will be adversely affected if you cancel the card depends on the percentage of available revolving credit that this card uses and how it can counteract any negative acct info on your report. However, if you leave it on there it will stay listed as an account that's in good standing. This could be an advantage to you if you want. If you never use the account, it will appear to other creditors that you've maintained a good account for a long period of time. They can't tell whether or not you've ever actually purchased anything with the card. I did this with a Discover card I had that was at $0 balance. I deactivated the account instead of cancelling it so that it couldn't be used via fraud, then I left it on my credit report. Now it shows that I have a perfect payment history with Discover for the past 10 yrs when in fact it's just a card that I never used or even wanted to use.

Answer 3

The following 5 critical factors affect your credit score in a major way. By knowing these you can keep a check on them and make your credit score a healthy one.

1. Re-payment history

This factor carries the highest weight in your credit report. How steadfast are you in repaying your loans, makes your credit report shine. Experts claim that this factor alone accounts for 35% of points in your credit score. So, if you falter on repayment front it is sure to be reflected poorly on your credit score.

2. Outstanding debt

The next comes your debt burden. How much you owe is a factor that according to experts carries about 30% weight in your credit score. This is
30% is based upon outstanding debt. To get a better score it is advised that you keep your outstanding debt to a minimum.

3. Length of your established credit history

The time for which you have a credit history also matters. The longer your established credit history the more credit reporting agencies believe in you. This could be simply because of the fact that they have more data to analyze your financial position. Experts give it a 15% weight in determining your credit score.

4. The state of your financial accounts
How much money do you have in your bank account, your income levels, your house, car, your assets etc. comes the next. A healthy bank account reflects a healthy credit score. Experts find that credit reporting agencies give this factor 10% weight while determining your credit score. Read more from: http://www.credit-card-gallery.com/article/204,5_critical_factors_affecting_your_credit_score

Answer 4

NO NO NO NO NO. If you close accounts, your score will go DOWN not UP

Your credit score is partly based on credit utilization and length of credit history. If the accounts your are trying to close are very old, your credit history will appear younger. Also, you'll have a higher utilization % because your total credit limit will be less. Just keep the accounts open. Go to credit.com to find out more, it's a very good resource.

Answer 5

Never close credit card account. It will lower your fica score and increase your debt/credit ratio.

Answer 6

cancel the ones with the highest interest rate and top limit,