I would like to close some of my accounts I opened my accounts to build credit to buy a house?

Question

I would like to close some of my accounts I opened my accounts to build credit to buy a house and now that I bought my house I would like to close some of my account. Would closing my credit cards and store cards hurt my score and if it does for how long .
and which credit card should i keep I have
2 amex cards gold card and other 1hsn 1ikea 2bank of america 2 chase 3 hsbc bank 1 capitol one and 1target visa
my bank of america is my oldest card and I only want to have 4 cards.
and buying my first home at 23 a mistake

Answer 1

Personally, I would close them ALL. If you are debt free and have enough income, you can get a mortgage without a credit score. The process is called manual underwriting. Before FICO, every lender used this process.

Answer 2

If the cards are paid off and you are not charged annual fees, you may be better off keeping the accounts open, but it depends on how this fits into the bigger picture.

One of the factors taken into account when you apply for a mortgage is the amount of credit you have available on all your cards. You want to be able to access some credit in case you need to use it, but if you have too much available to you, lenders get concerned that you could put yourself in dire financial straights if you maxed out all your cards.

The percentage of this credit you are currently using is another factor. For example, if you have a total of $20,000 in credit available to you and you have a $5,000 balance on credit cards, you are using 25%. If you close a couple accounts, which reduces the total available credit to $10,000 and you still have a the same $5,000 balance, you are using 50%. You are better off in the first example with only 25% of your credit in use.

Another factor is the length of time you have had each account. A longer amount of time is better, especially if you have paid your bills on time. Lenders don't like to see people open a bunch of credit cards, then try to get a loan right away because it is sometimes a "red flag" that the person is having financial problems that haven't shown up yet as late payments or non-payments.

The credit scoring system is pretty complex, so you should consult with someone at your financial institution or a financial counselor. There are good non-profit organizations that can look at your particular situation and offer you personalized advice. Try the following link to Consumer Credit Counseling Service...

http://www.moneymanagement.org/

Good luck.

Answer 3

I would definitely close most of those cards. I would start with the store specific cards. They typically have a very low limits and won't help your score out much if any.
The way credit cards are calculated on your credit score is based on the ratio of available credit to the amount of credit used. For example, if you have a total available credit of $50,000 and have $10,000 in outstanding balance, you would have 80% available. That would help your score out some because of the high percent available.
I believe that there is also a function that looks at the number of cards you have. 23 is too high.

After cutting out the store cards, get rid of the low limit cards that you have barely used. Keep the BofA card and any other cards that you have had balances on and have paid off in a timely manner; the more positive history on your accounts the better the scoring will be.

As far as I know, closing the accounts will not have any effect on your score unless you drastically change the ratio of available credit.

All that said, if you have cards with an outstanding balance, pay them off. That is the quickest way to build your score up.

Good Luck!

Answer 4

ok you have way to many cards. I have heard it said that you only need one credit card. Your credit reflects on the length of time you have had the loan. A long term good running credit is something you should keep. I would get rid of the "store" credit cards and keep only 1. master 1. visa 1. amex and the one you have had for the longest period of time.
I would also advise you to pay them off a little at a time. Meaning, if you owe $500.00 on one, don't send all of it at one time, send part of it and close the account slowly. I was told that it was better to do it this way than to just pay them all off at one time. If you don't have a balance on any of them just call the company and cancel it.
WOW! 23 and bought your first home. That is a very "grown up" accomplishment. Good for you! Trust me, you are very smart to be concerned about your credit and how you use it will affect you later.
I hope this helps.

Answer 5

if the cards are paid off then just leave them as long as you're not being charged a membership fee or some other user fees .
Yes closing them will affect your credit score for the next 2 years.
If you need to close one, pick the one with the lowest limit.
your available balances account for 30% of your score.