Do credit Card Cancel hurts your credit card report?

Question

I have certain cards that I do not use much and concerned about internet secured transactions due to fraudeulent activities in last 2 months. I have no debt on all of them are fully paid on time. Some I have never used for years. If I cancel them and reduce amount of cards, does it hurt my credit report? any web site to look for more information?

Answer 1

While it's true that lowering your available credit limit would impact your credit score, the ding would be very minor since you are paying all your credit cards in full.

Many people recommend keeping all credit cards open forever. But I think this is taking an unnecessary risk. That stack of cards in the sock drawer still have to be monitored and secured to prevent theft and fraud.

Keep the two oldest major credit cards that do not have annual fees. Only keep gas or store charge cards if you have some special purpose. Close the rest. Do it in writing and requrest written verification that the account is closed -- sometimes closed accounts come back to life.

Answer 2

It can since a full 30% of your credit score is based on your debt to credit ratio.

Say you have a total credit limit of $25,000.00 and debt of $7,500.00, you at 30% debt to credit ratio, if you cancel $10,000.00 worth of available credit then your at 75% debt to credit and your score takes a huge hit.

On the other hand if you have no debt at all and cancel several cards your debt to credit ratio would not change.

Answer 3

if you dont use the cards anymore, fine...dont cancel your account with them...keep your account open because on your report it will show that you have xxxx amount of credit available to you, but you dont use it. its better than having closed accounts on your report.

Answer 4

Here is a comprehensive answer from experts:

http://www.bankrate.com/brm/news/cc/20061114_cancel_card_credit_scorea.asp

Enjoy.