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41 open accounts and Lower rates
I have 41 accounts, several of which I have closed over the years that do not give a close date, they just say "closed at consumer's request."
Of the many that I have not closed, I have zero balance and I am in good standing.
Questoins:
Will closing these accounts help my FICO score?
Do companies usually say when the account was closed /does it matter?
How can I get cards with lower rates?
I have 6 accounts I am using and they are pretty maxed out. I am paying them off as I can, but the interest rates are killing me. Several are at 15%-20%. Got any ideas? I tried with MBNA and another and making those inquiries seems to have hurt my score. I have only one 30 day delinquency on my whole history and everything else is good. I owe about 50K and really want to get this paid off. Please HELP!
LeeAnn Aloha
Top
It's almost never a good idea to close accounts - it just hurts the score every which way but Sunday. V.
Some credit scoring models include a component that measures the average credit per line. That's the total of all credit limits divided by the number of cards. I agree that it's hardly ever beneficial to close accounts for the sound reasons given above. But if you've got one or two accounts with very low credit limits compared to the others, it might be in your best interest to pay them off and cancel them. For example, suppose you have only two cards with a $50,000 limit on one card and a $200 limit on the other. Your average per card is just $25,100 then. Pay off the $200 card and close it, and your average jumps to $50,000. That's an exaggerated example, but it makes the point. (Or, better yet, call the low limit card issuers and ask for an increase in your credit line.) I wish we had accesss to the actual scoring models used so that we could run these scenarios and find out precisely how the numbers are affected by proposed actions. I used the CreditExpert simulator once and asked it to determine the best way to improve my score. It told me that the best way was to pay down 95%-100% of my existing debt. There are no negatives on my reports--just lots of credit cards with lots of credit used on them. Gosh! No kidding!
We just got access to CreditExpert on the mortgage side, for loan officers to offer to consumers who need to improve a few points here or their and it looks like it might be an interesting service. I agree with you, that some of the creditor models are looking at all of the accounts utilization instead of just the individiual account utilization. Killing off a maxed $200 limit card will be best if you have others with $2,000 or more. So that the little one can't hurt the over all picture. Found a fairly decent site showing how to request credit limit increases - thought it was an interesting approach. http://www.bcsalliance.com/creditcards_ ... rrate.html NightStar Board Monitor/ Administrator Posts: 8443Joined: Fri Nov 07, 2003 7:35 pmLocation: Illinois Website Top
It's almost never a good idea to close accounts - it just hurts the score every which way but Sunday. V.
Some credit scoring models include a component that measures the average credit per line. That's the total of all credit limits divided by the number of cards. I agree that it's hardly ever beneficial to close accounts for the sound reasons given above. But if you've got one or two accounts with very low credit limits compared to the others, it might be in your best interest to pay them off and cancel them. For example, suppose you have only two cards with a $50,000 limit on one card and a $200 limit on the other. Your average per card is just $25,100 then. Pay off the $200 card and close it, and your average jumps to $50,000. That's an exaggerated example, but it makes the point. (Or, better yet, call the low limit card issuers and ask for an increase in your credit line.) I wish we had accesss to the actual scoring models used so that we could run these scenarios and find out precisely how the numbers are affected by proposed actions. I used the CreditExpert simulator once and asked it to determine the best way to improve my score. It told me that the best way was to pay down 95%-100% of my existing debt. There are no negatives on my reports--just lots of credit cards with lots of credit used on them. Gosh! No kidding!
We just got access to CreditExpert on the mortgage side, for loan officers to offer to consumers who need to improve a few points here or their and it looks like it might be an interesting service. I agree with you, that some of the creditor models are looking at all of the accounts utilization instead of just the individiual account utilization. Killing off a maxed $200 limit card will be best if you have others with $2,000 or more. So that the little one can't hurt the over all picture. Found a fairly decent site showing how to request credit limit increases - thought it was an interesting approach. http://www.bcsalliance.com/creditcards_ ... rrate.html NightStar Board Monitor/ Administrator Posts: 8443Joined: Fri Nov 07, 2003 7:35 pmLocation: Illinois Website Top