Closing credit cards?

iVillage Member
Registered: 06-07-1998
Closing credit cards?
4
Fri, 08-27-2010 - 3:52pm

Hi :)
Today I woke up $3600.00 less in debt than yesterday. A family member generously offered to pay off my personal credit card debt and is also putting a similar sum down on a mutual card of my hubby's and mine. We made a major move a couple years ago for a job and lower cost of living. Unfortunately my hubby's pay was not what it was supposed to be and we have been sinking.

Anyway my question is really about closing credit cards. I fell behind on my cards the last 4 months. Some have already been closed. Of the ones I have open 2 are Capital One. The were my very first cards and both carry annual fees. For a long time they were waiving those but when the economy began heading south they stopped doing that. In general they have been AWFUL about everything. They refused to waive fees so I could get caught up. They have been calling 20+ times a day PLUS calling my kids and hubby's cell phones. I have no idea how they even got the numbers.
I want to cancel them. How bad is this going to hurt my already injured credit score? I have heard you should never close a card?

thanks :)

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Avatar for jennebryan
iVillage Member
Registered: 11-25-2003
Sat, 08-28-2010 - 2:09pm

As long as those are paid off, I would definitely close them (especially because they charge an annual fee - there are so many other companies out there that don't charge an annual fee).


--Jenn

iVillage Member
Registered: 01-01-2008
Sat, 08-28-2010 - 7:04pm
How bad is the annual fee? When I worked in loans for a credit union, we looked at your available credit vs your used credit in addition to your actual credit score. The concern is rather you've used up all credit available to you (meaning you probably can't meet current financial obligations despite your income to expenses snapshot). So if you closed the card, in their eyes at least, you would look worse. I don't imagine they're the only financial institution to look at it that way. Also, I was denied credit before (can't remember for what - probably a car loan when I was younger) on the basis of longest open account not long enough or however they phrased it - basically meaning I hadn't had any one account open long enough for their liking. As far as how it will affect your actual number, I don't know.

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iVillage Member
Registered: 07-15-2007
Sun, 08-29-2010 - 3:19pm

Here's my story about Capitol One and annual fees. I had two cards with them that I never used. There were my first cards I got in college, so I just had them.

Then, because I never used them, they put an annual fee on them. I called and canceled both of them. They offered to waive the fee for me, but I just wanted to cancel because they had fairly low credit limits and I never used them.

Well, two months later I got a collection notice from Capitol One saying that there was a past due balance on both of my cards I canceled! After much calling (and getting the run around) I finally got a hold of a manger (after being VERY persistent). I explained I hand canceled the cards months ago, and I wanted my account back to zero and the cards canceled.

The manger tried to give me a run around but I threatened to call the BBB. I got the manger's name, their CS #, AND requested a letter be sent for both cards confirming that I had canceled the cards.

They leaped into action and I got my cancellation letters very quickly, and they removed the fees and zeroed both accounts out.

I checked my credit history to make sure they had taken that off, and they had.

You just have to be careful. I would never, ever pay an annual fee to a CC when there are so many begging for your business for free. That's just my take on it. Plus, if you've had trouble in the past with CC I would rather close it out so you aren't tempted to run it back up, KWIM?


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Avatar for scoopsmommy
iVillage Member
Registered: 03-28-2003
Thu, 10-07-2010 - 1:16pm

I would make sure if you close the cards, do so in writing and keep copies of everything.