Closing Accounts - Lower Fico Score?

iVillage Member
Registered: 12-09-2005
Closing Accounts - Lower Fico Score?
6
Wed, 08-27-2008 - 1:19pm

If you close your accounts

iVillage Member
Registered: 12-09-2005
Wed, 08-27-2008 - 2:22pm

Dear Credit Counselor:


iVillage Member
Registered: 08-26-2008
Wed, 08-27-2008 - 2:38pm

I wish you well.

iVillage Member
Registered: 07-02-2008
Wed, 08-27-2008 - 3:28pm

Don't know the answer just wanted to give you a NON-spam high five for speaking up about our new poster.


Best of luck getting your answer. Not sure about it.

iVillage Member
Registered: 11-17-2007
Wed, 08-27-2008 - 3:31pm

I will tell you what happened to me. Well what I did

iVillage Member
Registered: 09-28-2007
Wed, 08-27-2008 - 10:42pm
hi, i just wanted to add something to the question (sorry if i'm hijacking the post, musik!). i had a victoria's secret card with a low limit (maybe $500). it was paid off long ago and hadn't been used in years. i moved a few times and didn't realize they closed my account because of inactivity, i'm guessing. is this really bad for my credit history/score?




Photobucket
iVillage Member
Registered: 03-10-2008
Fri, 08-29-2008 - 1:22am

It is not extremely bad. A few years ago the trend with credit scores changed and it was no longer positive to cancel cards. What I have been told by my bank is that you should not go through your credit report and close a bunch of cards. The problem with that is once you close those your debt radio goes down, because creditors look at your credit limit total that you have been extended from all active creditors.

It used to be that creditors looked at your monthly payments and devised a ratio to determine whether or not you are a good risk. Now they look to see the total other creditors have lended you.

I dont think you will have any problem with the VS credit card being closed. That happens when you dont use a credit card. I can not imagine that one card is not going to make a different.

One other thing that creditors look is is your credit history i.e. how long is your credit life. You do not want to close an account that you have had for years. I do not know that your credit score goes down from that, but I know it is not recommended to do that.

My Macy's card was canceled because I did not use it for a while. I called Macy's and asked them to reactivate my account. I have to give them all kinds of information. I assumed that they needed this information to verify who I was. In turn it ended up being a NEW credit card. So instead of re-opening my original Macys card, they gave me a new one. In some ways this was good b/c my credit that I could use was higher (which is better for creditors to see) or now I have two cards for the same company, one opened one closed.

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