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Back when I was suffering from financial embarrassment, I had two high-interest-rate credit cards. One is 29.99% with a $6K credit limit and the other is 22% with a $4700 credit limit.
I paid one off entirely and just transferred the balance (around $2K) of the other to a much lower rate cc I got through my credit union. I have other debts, but my credit rating is better now and I was able to get a mortgage on a condo this past year.
I want to close those credit card accounts out and be done with them for once and for all (both have annual fees of about $40 that will be coming up in the next few months). I don't ever want to use them again. They were cards that were offered to people like me who at one time couldn't get a credit card any other way.
However, some websites and articles say don't close out your accounts because the ratio of debt to available credit will be higher. I'm not looking to obtain any new credit at this time or in the foreseeable future.
Kill them or hang on to them to make my ratios look better, and if the latter, why should I care right now?
You're done needing loans for the near foreseeable future. Like two years?
If so -- close the suckers. You have a card that can see you through the I need a plane ticket I have to rent a car damn the cost scenario that I went through when my mother was dying.
I do foresee a time when we go back to paying annual fees for credit cards, but until that comes to pass, don't. And tell them why you are closing the cards. And while it will hit your credit rating near term, in a few years your credit rating will recover.
I truly don't like how people are afraid of doing things that are in their best interest in order to appease the great god FICO.
Basically credit card use is like any other. The smae thign can happen with cash as mnay basically find with their robbing peter to apy paul paying bills. Crdit card useage is just a lack of control and can be a free easy to trqck 30 day loan.Once you get pout of crdit card debt you'll find that you will get offers toactaulyl get cards with cash back othsoe 30 day loans.If you can't control credit card usage then your unlieky to actually gain contol on your finances:IMO.
Back when I was suffering from financial embarrassment, I had two high-interest-rate credit cards. One is 29.99% with a $6K credit limit and the other is 22% with a $4700 credit limit.
I paid one off entirely and just transferred the balance (around $2K) of the other to a much lower rate cc I got through my credit union. I have other debts, but my credit rating is better now and I was able to get a mortgage on a condo this past year.
I want to close those credit card accounts out and be done with them for once and for all (both have annual fees of about $40 that will be coming up in the next few months). I don't ever want to use them again. They were cards that were offered to people like me who at one time couldn't get a credit card any other way.
However, some websites and articles say don't close out your accounts because the ratio of debt to available credit will be higher. I'm not looking to obtain any new credit at this time or in the foreseeable future.
Kill them or hang on to them to make my ratios look better, and if the latter, why should I care right now?
[quote=Tallysmom;17940245]You're done needing loans for the near foreseeable future. Like two years?
If so -- close the suckers. You have a card that can see you through the I need a plane ticket I have to rent a car damn the cost scenario that I went through when my mother was dying.
I do foresee a time when we go back to paying annual fees for credit cards, but until that comes to pass, don't. And tell them why you are closing the cards. And while it will hit your credit rating near term, in a few years your credit rating will recover.
I truly don't like how people are afraid of doing things that are in their best interest in order to appease the great god FICO.[/quote]
You're done needing loans for the near foreseeable future. Like two years?
If so -- close the suckers. You have a card that can see you through the I need a plane ticket I have to rent a car damn the cost scenario that I went through when my mother was dying.
I do foresee a time when we go back to paying annual fees for credit cards, but until that comes to pass, don't. And tell them why you are closing the cards. And while it will hit your credit rating near term, in a few years your credit rating will recover.
I truly don't like how people are afraid of doing things that are in their best interest in order to appease the great god FICO.
If I could, I'd rep you a thousand times for that statement alone!!
OP - having open lines of credit you're not using can be viewed as a liabiliy. If you apply for credit and are approved, who is to say you're not going to run out and rack up those lines of credit again - blowing the debt to income ratio the creditor considered when approving you?
If you are paying a mortgage and already have an existing card open that you're using, closing accounts you're not using is a minor hit that you should recover from in a very short amount of time. Depending on the circumstances, closing them may even improve your score by a margin because it closes the liability.
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