Good Credit Score - WIll closing CC accounts make it better?

[Warik]

My credit score is in the high 700s based solely on about 6 years worth of responsible credit card usage. I had read before about how having a lot of credit cards with high credit limits is a negative factor on your score. I imagine this would be because I could just go nuts one day and max out all my cards.

However, I also heard that closing a lot of unnecessary credit card accounts can be bad for your score because it reduces your credit-to-debt ratio... and also because it reduces the average age of your credit.

So yeah - I'm confused, but would like to improve my score and see if I can reach 800...

I have over a dozen open credit card accounts and I only use two of them (my AMEX and I have a MC for places that don't take AMEX). The AMEX has a very respectable credit line and will likely never be maxed out... so I really and truly have no use for these other cards. They're just sitting in a drawer at home. I'm told that your % of debt in relation to your credit should always be less than 15%, and since I don't carry a balance on any cards, that should never be a problem.

So... can anybody with real life experience on the subject make any suggestions? Should I just leave everything alone and rely on age and responsible credit usage to increase my score? Should I close all of my needless card accounts tomorrow? Should I do it little by little?

[ElaineMonster]

In general, don't close credit card accounts unless you truly cannot trust yourself not to use them. In that case, keep the accounts open but don't memorize the number (change it if you have to) and cut up the cards. Only close the ones that have fees, or better yet, call them and negotiate zero fees.

[Warik]

Not a worry... I trust myself implicitly. =)

So... pretty much the only way to improve one's score when he already has one is to just sit around and wait, eh?

[Mitch Evans]

Do you have a mortgage? You will most likely never reach 800 without a mortgage and a paid off car loan. High 700's will get you whatever you need anyway, so I wouldn't worry about it; it's just a number.

[sprmario]

If it's a small credit limit card that you haven't had for a long time, go ahead and close the account. But if you've had the card for a long time or it has a large limit on it, don't close it as your available credit will go down as will your ratio of outstanding debt to available credit. Cards that you've had for a very long time are also important to show a lengthy credit history. Short histories = bad.

I had a bunch of my dad's accounts on my report (same name obviously) and I had them removed and it hurt my score. I only removed them from one of the credit bureau's as I figured this out before initiating reports on the other two.

Anything over 700 is pretty good. I had 730 when i went to buy my car and got a rate only .2% higher than my dad who has a 800 score, and the fed had bumped rates 25 basis pts in that time, so we basically got the same rate.

There are tons of websites out there that can teach you how to go about improving your credit. I basically just started disputing everything. Anything they cannot verify has to be removed. You have to do this in a slow manner though because if you dispute too much at once, they can just dismiss the dispute as being frivolous. I had some late payments on my student loans and credit cards removed because the companies that had those loans no longer exist and so they couldnt' verify them. [img]/images/graemlins/smile.gif[/img]

[NickPappagiorgio]

If you're credit score is in the high 700s you'll be able to get the best rates for almost anything as long as you meet the other requirements such as income. I worked as a Mortgage Loan Officer for about 2 years so I have a decent amount of experience with credit reports and scores and have been to credit seminars. What sprmario said is pretty much right on. You don't want to close out old accounts as they go to establish your credit history. Also, you don't want to close out bigger lines of credit because they help your overall debt to credit ratios. Getting over 800 is really hard and there's really not much you can do to ensure it. Also, credit scores can vary between different industries such as auto credit scores and mortgage credit scores.

[eastbay]

Never close a CC account. Any score above 720 is generally all the same - you're in the top bracket. There is nothing special about 800 that I know of.

eastbay

[ElaineMonster]

[ QUOTE ]
So... pretty much the only way to improve one's score when he already has one is to just sit around and wait, eh?

[/ QUOTE ]

No, don't just sit around and wait. Check your report regularly to make sure there aren't errors. Continue to pay your bills on time. Don't go applying for tons of new cards or other loans at the same time. Don't co-sign with someone who can't or won't pay on time. In general, though, yeah, just keep what you're doing and relax.

[Warik]

Thanks everyone... I'll keep them in a drawer since they're not doing any damage right now. Hopefully all of the credit I have available right now will not be a negative factor when I try to apply for a mortgage loan.

[Dazarath]

I think the problem comes in when you have too many, and you have to keep remembering the cut the new ones they send you. Or, you could end up with a similar problem to my friend. He was expecting a replacement card, which never came. Next thing he knows, he has a credit card bill with a $400 purchase made in Italy. (We were in LA for school.)