I%26#039;ve paid off all my debts on my credit cards but I%26#039;ve been told not to close any of them as I%26#039;m trying to re-build my credit. But is it worth keeping them open if they charge an Annual Fee? How much damage to my credit score will occurr if I choose to to close an account rather than pay $59-$79/yr?
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
Ok, first let me tell you what makes up your score:
1. Payment history- 35%
2. Total debt owed vs. available credit- 30%
3. Length of time establishing credit- 15%
4. Types of credit established- 10%
5. Inquiries and New accounts- 10%
Whenever you close accounts, you affect #1,#2, %26amp; #3. The payment history for all your open accounts are shortened, you decrease the amount of available credit making it look like you owe more than you%26#039;re able to borrow, and finally if the account was opened a while you shorten the average age of all your accounts. As for the annual fee. you can work this to your advantage. One option would be to use it as a leverage piece to close the account. Request to be changed to a card without a fee in exchange for you keeping the card. If that option doesn%26#039;t work, then instead of using the card lightly to show activity every month, just make minimum payments on the anuual fee until it%26#039;s paid, then spend no more than $20/ month on the card. That way, you can still show activity on the card without having use the card a whole lot to build credit.
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
You got told wrong..
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
If you want to cancel the cards to avoid the fees, by all means do so. It will have very little impact on your credit score.
A good way to increase your credit score is by going to your bank and getting a small loan. Make sure that you have a minimum of $2000 in your bank account and get a loan for a small amount minimum of $1000 with the funds in your account as collateral. Place the money from the loan in your account and just make the payments on time.
A small loan like this can be paid off quickly and will increase your credit score very fast.
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
You should keep your accounts open as it does help your credit.
As far as the annual fee, you can call customer service and tell them that if they keep charging the annual fee you will close your account.
I work for a credit card company and see them waive it every single day. Also try to make at least one purchase every six months and then pay it off otherwise they will close it for inactivity.
Good luck!!
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
As long as you don%26#039;t close all your accounts in one month, you should be fine. Closing all your accounts makes it look like you aren%26#039;t able to handle credit responsibly, and that reflects badly. You also don%26#039;t want to have too much credit, because it%26#039;s too much of a temptation for people, and creditors will look at it as %26quot;if they charge all of this, will they be able to repay it??%26quot;
If all the cards you have charge an annual fee, and you have a lot of them, closing 1-2 is a good way to start. However if it%26#039;s the ONLY one you have, I would recommend keeping it. Using the card and making timely payments on it will help your credit score long-term.
You might also try to call the credit card company and to talk with them - they might be able to do something as a benefit to having you as a card member in good standing since you cleared your debt - even if you still have to pay the annual fee. It never hurts, and the worst thing they can say is %26quot;no%26quot;, in which case you can look for another card, apply and get it, then close that account. Yay for competition.
Just don%26#039;t get an itch to go overboard on your credit, and make sure you pay all your bills on time, and your credit score should get better. Managing credit is very important.
Now that you listened to this, applying it is a lot harder. lol Good luck on rebuilding your credit.
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
hmm, good morning there, I think you just read thru this resource below to address your concern dearie
have a super day
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
Part of your credit score is determined by the length of time you have been using credit. Therefore it is in your best interest to keep your oldest account open. There is no need to keep several cards that carry an annual fee.
If your oldest card carries an annual fee and there is a card that doesn%26#039;t have one that is a close second then by all means get rid of the card that carries the fee. Fees are not worth it so it%26#039;s best to eventually get rid of all cards that carry a fee. If you%26#039;re not making a major purchase that is dependent on credit (car, home) ditch the cards with the fees unless it means shortening your credit history by 2 or more years.
If you%26#039;re trying to re-build credit, is it worth keeping credit cards open even if they charge an annual fee?
I think so.. this will help your credit
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