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Re: Too much open credit?
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Posted by -michelle
on March 11, 2002 at 22:58:48:
In Reply to: Too much open credit? posted by Rick Friele on March 11, 2002 at 19:36:28:
Closing a credit card account can hurt your credit score because the longer you keep an account open the higher the *average* age of your all your accounts is (this is good). Once you close an account, it will never get any "older", so it's contribution to the "average age" factor will never increase. Having too many accounts open or too much available credit in relation to income can also hurt. Your catch-22 for these two factors is that if you leave all your accounts open, you will have too many accounts/too high available credit. If you close some, you "average age" will not develop. Review your accounts. High-interest cards, retail store cards, and cards with monthly or annual fees should be first on the chopping block. If you have cards that are already "old" (a few years), think twice about closing them. It's better not to close an account with a balance until you have paid it off. Your average age of credit will not be high yet, anyway, since you've probably only had credit for about 3 years total, anyway. So don't worry about 3+ years before you can close, but try to get at least 1+ year. When you close your accounts, make sure you request a dated letter from the card company that states that your account was closed at *your* request, and that you have a zero balance. That way, you'll never have to deal with a card company pulling the same schtick as the hospital. -michelle
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