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Credit Cards??
Credit Cards??
I have a total of 10 credit cards with ranges from $300 to $25,000 limits.. I want to cancel all but maybe 3 or 4 to 5 max of the cards.. Which cards should I cancel? I have heard that if I cancel cards I've had for a long time, that will hurt my credit score. Please help!
1 card with $25,000 limit
1 card with $10,000 limit
1 card with $7,500 limit
1 card with $3,000 limit
1 card with $2,000 limit
1 card with $1,500 limit
1 card with $1,000 limit
1 cards with $500 limit
2 cards with $300 limit
Answers:
freddy70685171: Cancel the ones with the lowest limits. Then pay those off first.
2007-05-25 02:24:55
2007-05-25 02:24:55
Chosen Answer
vanessa_page_2004: Do you have any balances on the cards? If so, move the balances to the cards with the lowest interest rate and cancel the higher ones. (Also, if you are an American, try calling your credit card company and ask them to reduce your rate of interest).
Logically, you should keep the cards with a higher credit limit because it shows that you are credit-worthy and your debt-credit ratio is lower (that is good for your credit score) but if they are all new cards I would keep the oldest or a few older ones around.
Also, cancel the cards that charge an annual fee and if you have points on the cards, see if they can be redeemed or transferred to cash or another point system (www.points.com)
Finally, if you really don't want to hurt your score, do not apply for too many credit cards or credit checks. Too many inquiries into your credit history will damage your score. Also, do not default on payments because you can lose 100+ points for even 1 single late payment.
Hope I helped :)
2007-05-25 02:31:03
vanessa_page_2004: Do you have any balances on the cards? If so, move the balances to the cards with the lowest interest rate and cancel the higher ones. (Also, if you are an American, try calling your credit card company and ask them to reduce your rate of interest).
Logically, you should keep the cards with a higher credit limit because it shows that you are credit-worthy and your debt-credit ratio is lower (that is good for your credit score) but if they are all new cards I would keep the oldest or a few older ones around.
Also, cancel the cards that charge an annual fee and if you have points on the cards, see if they can be redeemed or transferred to cash or another point system (www.points.com)
Finally, if you really don't want to hurt your score, do not apply for too many credit cards or credit checks. Too many inquiries into your credit history will damage your score. Also, do not default on payments because you can lose 100+ points for even 1 single late payment.
Hope I helped :)
2007-05-25 02:31:03
larasing: The easier answer to your question is to keep the cards with lower interest rate to minimize your monthly payment. However, if you are interested in putting in some work to improve your credit score, you need to do a couple of things before you figure out which to cancel.
1. Get your credit report from Equifax, Experian and Transunion (not just your FICO score). They will have the credit card's payment history on them, going back as far as two years (if you don't have any serious delinquency like bankrupcy and default). Write down the list of cards for which you have full two year of payment history, and note if there any late payments and how many delinquencies.
2. Check each of your credit card statements and figure out how much you need to pay for your daily necessities like bills and food and how much money you usually "splash". Write the average amount for both down.
Finally, based on how much you spend per month you need to determine what cards you'd keep. Let's say you spend $3000 on necessities, and $3000 on 'splash', you might then want to keep a total of $20,000 credit (the amount will change depending on your actual spending pattern). This combination will keep your debt level at about 15% (and it gets to 30% if you splash, but still not terrible) of total credit and give you a higher score. And when you determine which cards to keep for the $20,000 total, try to select cards with longer, healthier payment history.
Rule of thumb:
1. You don't want to have a high % of debt to credit
2. You don't want too much credit (that increases your chance of default by the current rating system and decreases your score)
3. Smaller credit is sometimes better as you might get more favorable interest charged on them compared to a larger credit, for the same reason of increased chance of default.
Good luck and hope this helps!
2007-05-25 02:40:23
1. Get your credit report from Equifax, Experian and Transunion (not just your FICO score). They will have the credit card's payment history on them, going back as far as two years (if you don't have any serious delinquency like bankrupcy and default). Write down the list of cards for which you have full two year of payment history, and note if there any late payments and how many delinquencies.
2. Check each of your credit card statements and figure out how much you need to pay for your daily necessities like bills and food and how much money you usually "splash". Write the average amount for both down.
Finally, based on how much you spend per month you need to determine what cards you'd keep. Let's say you spend $3000 on necessities, and $3000 on 'splash', you might then want to keep a total of $20,000 credit (the amount will change depending on your actual spending pattern). This combination will keep your debt level at about 15% (and it gets to 30% if you splash, but still not terrible) of total credit and give you a higher score. And when you determine which cards to keep for the $20,000 total, try to select cards with longer, healthier payment history.
Rule of thumb:
1. You don't want to have a high % of debt to credit
2. You don't want too much credit (that increases your chance of default by the current rating system and decreases your score)
3. Smaller credit is sometimes better as you might get more favorable interest charged on them compared to a larger credit, for the same reason of increased chance of default.
Good luck and hope this helps!
2007-05-25 02:40:23
Bell: I would pay off the cards with the lowest balance and then cancel them and then once I've done that I would chip away at the big bills but do not cancel them once they're paid off. They are good on your credit score. I hope this helps a little bit!
2007-05-25 04:32:44
2007-05-25 04:32:44
angela: Keep the 2 or 3 cards with the lowest interest rate and lower available credit lines. Pay them off monthly, if possible. Cancel the ones with the highest limits. I've been told that lenders not only look at what you have charged but also at your potential debt. Your potential debt with the cards you have listed is over $51,000. That could hurt you if you tried to buy a house or something. Depending on how you use the cards and what the interest rates are, I think I would keep the $500, $1000 and $1500 cards and cancel the rest. But, don't max out the cards that you do keep. Another option is to keep a few more accounts open but cut up the cards so you don't use them. That way they show as open accounts in good standing but you won't be tempted to charge on them.
2007-05-25 06:01:48
2007-05-25 06:01:48
stopccdebt: Keeping the ones you have had the longest will help maintain your credit rating. In general, you should consider canceling cards that have low credit limits or that have no helpful rewards. Rewards cards that pay in points are nearly worthless.
Also, ask yourself what is the point of holding a credit card with less than $1k credit limit? It is practically worthless.
It is true that some lenders may be leery of high available credit. However, your best bet is to wait until they inform you of that. You can call the creditor and have your limit lowered within 5 minutes. There is no proven advantage to doing this before applying for a mortgage!
2007-05-25 07:40:51
Also, ask yourself what is the point of holding a credit card with less than $1k credit limit? It is practically worthless.
It is true that some lenders may be leery of high available credit. However, your best bet is to wait until they inform you of that. You can call the creditor and have your limit lowered within 5 minutes. There is no proven advantage to doing this before applying for a mortgage!
2007-05-25 07:40:51