Does it positively affect your credit to close credit cards that you no longer use?

Question

Conversely, will it negatively affect my credit if I don't close an account that has a $0 balance?

Answer 1

If the credit cards you want to close are fairly new, I would cancel them.  If  you move and the account is still open with a zero balance, remember to notify the co of the new address because when the exp date expires, you  would get a new card sent to your old adress.

Answer 2

Regardless of whether you use it or not, it always negatively affects your score when you close account. A key point in having a good credit score is the amount of times that your accounts are opened. Even if you dont use the account, just let time pass and it will posetively affect your score. Leave the accounts open, other wise it will cause your score to do go down.

Answer 3

Don't close them, just either put them away in a drawer or cut the up.  If you close them it will effect your score in a negative way.

Answer 4

Closing credit looks bad on you. Because it is looked at on how much available credit you have. Yet not using a card sometimes means that it will not be reported to the credit company.

Answer 5

A large part of your credit score is based on the ratio of credit card debt to available limit.  If you close credit cards, you lower your available limit.  This would increase the debt percentage if you are carrying balances on any other credit cards.  Carrying balances of more than 30% hurts your score.

So, if you are carrying balances on other credit cards, don't close unused accounts until all credit card balances are paid off.

Another consideration is that closing accounts also closes the payment history.  Although, the closed account will still probably show for about 10 years.

Basically, closing credit card accounts doesn't positively impact your score at all.  However, I personally think that having a stack of credit cards stuck in your sock drawer is a bad idea.  You have to monitor and secure all those accounts against fraud and ID theft.

I recommend that if you are not carrying balances on other credit cards, that you keep the two oldest major credit cards that do not charge annual fees.  If you have a newer account with higher limits and rewards program, you may want to keep that also.  Only keep store or gas charge cards if you have some special reason and actually use them.  

Close everything else via letter and request written confirmation that the account is closed and 0 balance.

Initially this will lower your score; however, it will rebound within a few months.

Answer 6

15% of your FICO scores depend on length of credit and they use the time when you opened your oldest account currently not closed. Plus it tends to hurt your debt to credit ratio. If you have too much credit and want to close down a few cards, make sure to keep the 2 oldest ones open. If you close the old ones you will loose points as the length of your open credit is now reduced.

I have a card since 2000 with limit of $500 which I never use. The only reason is because most of my cards are in 2003 and 2004 and some in 2006. They calculate the time of my credit to be 8 years old. If I cancel it, it would be 2003 so I loose 3 years which will not look good.