Best way to cancel a credit card?

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trumpet-205
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Postby trumpet-205 » Mon Jan 07, 2013 12:55 am

Woah! There is a lot of misinformation going on here.

Closing a card does NOT hurt your AAoA, not within 10 years from the time of closure. A closed account stays on your credit report for 10 years and during these years it WILL be included in AAoA. This is true for FICO and VantageScore (two scores that matters). TransRisk score from CK is different but no lender at this time use TransRisk.

If you don't use the account close it, even if it is the oldest one. It will do no damage to you (beside short term overall utilization) for 10 years. By then it hardly matters.
In My Wallet:
Citi Forward (12/2010) | Citi TY Preferred (05/2011) | Chase Freedom (11/2011) | GECRB/PayPal (05/2012)
Discover it (07/2012) | AMEX BCP (09/2012) | TD/Target REDCard (10/2012) | Chase Ink Classic (11/2012)
BofA BBR (04/2013) | FNBO/Overstock.com (02/2014) | Barclaycard Arrival (04/2014) | FIA/Fidelity AMEX (04/2014)


kcarter609
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Postby kcarter609 » Mon Jan 07, 2013 7:08 am

trumpet-205 wrote:Woah! There is a lot of misinformation going on here.

Closing a card does NOT hurt your AAoA, not within 10 years from the time of closure. A closed account stays on your credit report for 10 years and during these years it WILL be included in AAoA. This is true for FICO and VantageScore (two scores that matters). TransRisk score from CK is different but no lender at this time use TransRisk.

If you don't use the account close it, even if it is the oldest one. It will do no damage to you (beside short term overall utilization) for 10 years. By then it hardly matters.


Ok, how does it factor in then? If I closed it after it was open for exactly 4 years, does it count as a 4 year history? Or over those 10 years does it continue to to increase in length of time? I'm assuming the former.

Active Cards:
Chase Freedom 10+10 Visa Signature ($9k Limit - 8/2012)
Chase Sapphire Preferred ($10k Limit - 2/2013)
Chase Ink Plus ($7k Limit - 2/2013)
Discover IT ($9.5k Limit - 10/2012)
AMEX Zync (No Pre-set Limit - 1/2010)
AMEX Blue Cash Everyday ($20k Limit - 1/2013 - Backdate to 1/2010)

trumpet-205
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Location: CA, USA

Postby trumpet-205 » Mon Jan 07, 2013 9:35 am

kcarter609 wrote:Ok, how does it factor in then? If I closed it after it was open for exactly 4 years, does it count as a 4 year history? Or over those 10 years does it continue to to increase in length of time? I'm assuming the former.


A closed account will continue to age until it falls off your credit report.
In My Wallet:
Citi Forward (12/2010) | Citi TY Preferred (05/2011) | Chase Freedom (11/2011) | GECRB/PayPal (05/2012)
Discover it (07/2012) | AMEX BCP (09/2012) | TD/Target REDCard (10/2012) | Chase Ink Classic (11/2012)
BofA BBR (04/2013) | FNBO/Overstock.com (02/2014) | Barclaycard Arrival (04/2014) | FIA/Fidelity AMEX (04/2014)

kcarter609
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Location: VA

Postby kcarter609 » Mon Jan 07, 2013 12:29 pm

trumpet-205 wrote:A closed account will continue to age until it falls off your credit report.


So if I close an account that is 4 years old, 9 years after that time, it'll count as a 13 year old card until it falls off the following year?

Active Cards:
Chase Freedom 10+10 Visa Signature ($9k Limit - 8/2012)
Chase Sapphire Preferred ($10k Limit - 2/2013)
Chase Ink Plus ($7k Limit - 2/2013)
Discover IT ($9.5k Limit - 10/2012)
AMEX Zync (No Pre-set Limit - 1/2010)
AMEX Blue Cash Everyday ($20k Limit - 1/2013 - Backdate to 1/2010)

Robrus1
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Location: Texas

Postby Robrus1 » Mon Jan 07, 2013 1:49 pm

kcarter609 wrote:So if I close an account that is 4 years old, 9 years after that time, it'll count as a 13 year old card until it falls off the following year?


That is correct.
Amex Platinum
Amex BCP 21K
Amex SPG 5K
Barclaycard Arrival Plus WEMC 5K
Chase Sapphire Preferred 23.5K
Credit Union 10K
Discover IT 7.75K

Ronisonce
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Location: Massachusetts

Postby Ronisonce » Mon Jan 07, 2013 9:30 pm

Ok, so I (male) would be better off canceling these cards even though 1 of them is the longest running card I have? The one card I will cancel once I pay it off is the Jared Galleria of Jewelry. Stupid me, bought my girlfriend a ring thinking it was a loan unaware it was a credit card for 10k. Didn't read the fine print. Will pay off this month and cancel. Or will that affect my credit negatively ?

trumpet-205
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Location: CA, USA

Postby trumpet-205 » Mon Jan 07, 2013 9:54 pm

No it will not. Once you paid off the account let the next statement posts (so that it reflects $0 balance), then close it.
In My Wallet:
Citi Forward (12/2010) | Citi TY Preferred (05/2011) | Chase Freedom (11/2011) | GECRB/PayPal (05/2012)
Discover it (07/2012) | AMEX BCP (09/2012) | TD/Target REDCard (10/2012) | Chase Ink Classic (11/2012)
BofA BBR (04/2013) | FNBO/Overstock.com (02/2014) | Barclaycard Arrival (04/2014) | FIA/Fidelity AMEX (04/2014)

Ronisonce
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Joined: Wed Jan 02, 2013 9:18 pm
Location: Massachusetts

Postby Ronisonce » Mon Jan 07, 2013 10:04 pm

Ok thank you. I just read an article that said it won't hurt your credit at all if you have 0 balance on ALL credit cards when you cancel whichever card you want. That way it won't hurt your credit utilization score.



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