Should i close my credit card?

Question

i have a wells fargo college visa credit card that has been active since october 2007. there's a $700 limit on it. i have been over the limit twice, but paid the fees right away. my card is currently paid off and i'm not using it because i use my alaska airlines visa card more often. so, 2 questions:

a) is it safe to close the account since it's paid off? or should i still keep it open and not use it?

b) since i have been over the limit twice, what are ways that i can improve my credit score?

thanks in advance for your time and answers.

Answer 1

keep it open but don't use it.  In fact, cut it up and then you won't be tempted.

This is because your credit score is hurt when you close accounts (it isn't considered a routine activity and closing it won't make those payment issues from the past disappear.  So, you lose if you close it and gain a bit by keeping it open.

The age of your accounts helps your score.  You can improve your score by paying your bills on time, keeping your balances low, and waiting...   Time is a big factor.

Don't open new accounts, that hurts your score too.

When people tell you the % of FICO that is affected by certain activities - take it with a grain of salt.  FICO's owners, Fair Issacs, has never released the formula for FICO scores and FICO changes.  

The only way you can know is to watch what your actions do to your score and to look at a score analyzer which will give you ideas of how to improve your score, but not specific numbers on how it will change.  That is not possible.

You can find score analyzers at any of the credit reporting firms, you typically have to pay for it though.

Answer 2

It is always a rule of thumb to keep the oldest cards open.  This is because 15% of your fico is calculated by your credit history so the longer you have an open account the better.

Ways to improve score:

30% of fico is your credit to debt ratio....Use cards wisley, keep balance below 50% of the full credit amount at all times.

35% of you fico is if you pay on time.  Doesn't matter how much u pay just as long as u pay the minimum ON TIME.

10% is amount different account u have.  The more open credit account the worse or slower your fico will increase.

and the last 10% which sort of contradicts the other 10% but it's a good idea to have a few credit lines open. It‘s a bit ironic, but the one thing that makes lenders absolutely nuts is if you have no cards or loans; they then have no way of gauging whether you will be a good customer.