Financial Question

[kuronosan]

I want to cancel a couple of my credit cards in the new year, because I'm sick of the customer service and the rates. The last time I tried to cancel my cards, the rep told me that doing so would negatively impact my credit and make it worse as since it's the only card I've had for more than 7 years credit companies will frown on me for canceling it.

Is there any credence to this? Will it really hurt that bad if I drop these guys (hate their policies)?

[Zalius]

it makes you more of a risk to other companies, but if you're in good standing credit already it wont matter. if it's 7 years of you being a bad customer, youre outta luck.


the rep tells you that to keep your money. they were doing their job, and they probably didn't want to, but the company knows that saying that to you will scare the shit out of you. if you have other cards, you'll be fine as long as you know how to manage your money/aren't in a ton of debt already.

[_chuchu]

They're going to do everything they can to retain you, but it's not going to kill you in the long run. Having lines closed at your request is way better than most of the other alternatives. As long as lines are open and occasionally being utilized wisely, you'll be fine.

[kuronosan]

I have another credit card with a higher limit, I'm just tired of these guys charging me the annual fee over 12 installments and calling me when I've already paid them... plus they have never raised my credit limit.

My credit history with them has been perfect too.

[Aerides]

Closing an account yourself will never make a "negative" score on your credit. Closing a 7 year old card doesn't shorten your credit history - trust me they'll still be reporting it for you for years to come.

The one factor they are manipulating in their "retain this cardholder" salespitch, is, ok sure it's a good thing to have a strong "debt to available credit" ratio. In other words, right now if you have $10000 available credit, and only $500 debt, you look good. Close some accounts and make that $2000 available vs. $500 deft, and not so good - ie, a slightly higher risk insofar as you are 25% used now instead of 10% used. It's a marginal argument, and if a bank is twisting that to make you stay - run the fuck away and cancel that one first.

There is little, if any, need to keep more than 1-2 credit cards ever.

[Kyreth]

Get rid of the thing if it's ticking you off. Closing a credit line you've paid regularly and well doesn't do bad things at all, other than gets whoever was giving to you hot and bothered about making sure you keep it. Especially since you've got other cards.

[Bipolargod]

My credit history with them has been perfect too.

You have nothing to worry about, it shouldn't effect your credit score if you've never been late on payment.

[Zalius]

Closing an account yourself will never make a "negative" score on your credit. Closing a 7 year old card doesn't shorten your credit history - trust me they'll still be reporting it for you for years to come.

The one factor they are manipulating in their "retain this cardholder" salespitch, is, ok sure it's a good thing to have a strong "debt to available credit" ratio. In other words, right now if you have $10000 available credit, and only $500 debt, you look good. Close some accounts and make that $2000 available vs. $500 deft, and not so good - ie, a slightly higher risk insofar as you are 25% used now instead of 10% used. It's a marginal argument, and if a bank is twisting that to make you stay - run the fuck away and cancel that one first.

There is little, if any, need to keep more than 1-2 credit cards ever.

the percentage of total owed paid per installment is MUCH more important than the current balance (relative to when you used the credit to establish the balance) to the seller(s). theres a magical number that they're looking for you to have (if i knew how to do the math for it, i'd have a lot more money) to give them as much profit as possible.

the total balance is a useless number without the % of balance paid.

[archibaldcrane]

I was going to jump in here with "if it's your oldest line of credit don't cancel it" until I saw the "annual fee" part - fuck that.

Ditch that shit ASAP - don't pay annual fees on credit cards unless they have truly awesome rewards programs (like my Escape Discover card) and you use them a lot.

[Caiyuo]

I was going to jump in here with "if it's your oldest line of credit don't cancel it" until I saw the "annual fee" part - fuck that.

Ditch that shit ASAP - don't pay annual fees on credit cards unless they have truly awesome rewards programs (like my Escape Discover card) and you use them a lot.

So is it more important not to cancel your first card or are they looking at how long you had the first card that you cancelled? I have 3 now and hardly need 2, my first being a CapitalOne (shocker) that I've had for about 5 years. It's not really bothersome as I pay my balances monthly in general, but it has the worst interest rate of the 3 and it'd just be nice not to have to juggle all 3.

[Lbelle]

I was going to jump in here with "if it's your oldest line of credit don't cancel it" until I saw the "annual fee" part - fuck that.

Ditch that shit ASAP - don't pay annual fees on credit cards unless they have truly awesome rewards programs (like my Escape Discover card) and you use them a lot.

fuck that discover card IT'S A TRICK

[Acturus]

So is it more important not to cancel your first card or are they looking at how long you had the first card that you cancelled? I have 3 now and hardly need 2, my first being a CapitalOne (shocker) that I've had for about 5 years. It's not really bothersome as I pay my balances monthly in general, but it has the worst interest rate of the 3 and it'd just be nice not to have to juggle all 3.

If you've had a card for a while, and don't want to cancel, call the company and see if you can re-negotiate a better rate.

They want to keep your business, and it never hurts to ask.

[Caiyuo]

fuck that discover card IT'S A TRICK

I guess "it takes one to know one" isn't an appropriate response here? lol

If you've had a card for a while, and don't want to cancel, call the company and see if you can re-negotiate a better rate.

They want to keep your business, and it never hurts to ask.

Thanks, they just bumped up my limit and have done so over the last 2 years without asking, so I guess for the most part I'm in good standing. I just figured I was stuck with it since it was my first card and expected a completely butt rate.

[Acturus]

I guess "it takes one to know one" isn't an appropriate response here? lol


Thanks, they just bumped up my limit and have done so over the last 2 years without asking, so I guess for the most part I'm in good standing. I just figured I was stuck with it since it was my first card and expected a completely butt rate.

the mom of a friend of mine in high school had 3 different credit cards. Over the years, she had gotten the limits raised a little at a time, and she was able to purchase my friend's Mustang on one of them when he turned 16 because the rate was better than any Auto loan. She'd also make it a habit of getting the rate reduced on one, and rolling the balance over from the other(s).

Over time, your credit cards can work for you, if you keep up with them.

[Caiyuo]

Wow, thanks. I think I'll reconsider hanging onto it, though I'm a little worried about not using one of them as I generally end up randomly charging something small to my most recent in order to keep a balance on it. 3's more than I need now, but I'd think in the future it'd be nice or necessary, so I don't mind juggling for a little while longer if the benefits come along with it.

Sorry for the mini-hijack as well.

[Cephius]

It's not a bad idea to hold onto them, the point of using your credit is so you can make big purchases but still hang on to lump sums of money, invest it, and make it work for you.

[kuronosan]

The last time I requested a limit increase they bumped it up $100.

[eunhye]

Be kind to your local merchants, mom & pop stores when you swipe. Those rewards that CC companies offer are usually paid by merchants.

http://www.npr.org/templates/story/s...ryId=121261576

I try to pay cash in local shops and use credit in big name stores.

[Cephius]

Be kind to your local merchants, mom & pop stores when you swipe. Those rewards that CC companies offer are usually paid by merchants.

http://www.npr.org/templates/story/s...ryId=121261576

I try to pay cash in local shops and use credit in big name stores.

Many stores of that nature also pass on that cost to customers though. Either via higher prices, charging an extra $.50 to use credit, or charging tax when they otherwise wouldn't are all things I've seen around here. I consider "being kind" to be giving them my business as opposed to shopping at an (often cheaper) big name store. How I pay should be up to me.

[Zalius]

It's not a bad idea to hold onto them, the point of using your credit is so you can make big purchases but still hang on to lump sums of money, invest it, and make it work for you.

that is the theoretical ideal. more people, however, use it as a means of buying something faster than they would have before, giving them a minimum-earned threshold per month of things they need to pay (turning purchases into bills instead of purchases).

this basically means that the hours they spend at work are now generating finances for the credit company. you can say that the theoretical ideal is the point all you want, but until you explain to someone why that's the ideal, and why the opposite is bad, you haven't actually done anything positive to assist them, you've only asserted something and told them to believe you.