Closing a credit card is one of the important decisions to be made on Credit Card Mangement. Before you close the credit card, you need to know how it will affect your credit score.
Closing a credit card with or without balance will affect your credit score, not immediately but later.
Here are some of the advantages that you might get from closing a credit card:
- Ease the process of Credit Card Management
- Your credit report might have lesser information, if cards are closed properly
- Lesser the cards, lesser the debt
- Protecting yourself from Identity theft
- Fees on the cards are avoided
Listed below are some of the basic information you need to know before closing a credit card:
Does not improve Credit Score
If you are closing your credit card to improve the credit score, think back; because it does not. Even if you close it, the history associated with the card remains. Credit Score depends on the ratio of balances-to-limits. If you close a card for which you don't need to pay anything on it, it might not affect the score.
Impact based on whether who closes the card:
There is no difference on your credit score depending on whether you or the card issuer close the card.
Older the Card, better helps for Credit Score
Closing a card that you have used for 20 years with good payment history will affect your credit score negatively.
These are just the basic information and more details are to be discussed on the forthcoming posts.
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Posted via email from eCreditAdvisor's Blog by SocialNetGate
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