FICO score vs. account age

Mongo · 02-14-08, 10:35 AM

First off...Hi all. Haven't logged on here in about 2 years.

I was living in hicksville and only had dialup, and slow dialup at that. Finally moved back to Maine a year ago and got DSL....but never got around to coming back to the otter farm until now when I need your help.

Ok, now on to the real question. I had pretty poor credit at one point, but over the last few years it's been getting better, and during the last year or so it's started moving up a decent amount due to some loans etc that I took out for the express purpose of strengthening my credit history. Yay me!

So, along the way I've picked up a few credit cards as well (Amazon card being my 'daily use' card for the GC's) A month or so ago, I decided to go ahead and accept an offer for another card and signed up for it online. Well, the credit limit they gave me is....useless, lol. Honestly, I see no point in keeping the damn card, however, I'm worried that if I cancel it after only having the account open for a few weeks that it'll ding my FICO score which I've been working so hard on improving.

So which is my best option?

A) Cancel card even though it's only a couple of weeks old.
B) Keep the card, but 'forget' about it. Since the credit limit is so low I assume it's not going to hurt me much.
C) Other?

And now that I've come back to ask this one thing....I'll probably end up being around a whole lot more. It's kind of like peeing when you're drinking beer. You can hold it for a long time at first, but once you cave that first time you're running back for more every 10 minutes.

GradVT06 · 02-14-08, 10:41 AM

B

More available credit is a good thing.

Also, having the open card with no balance gives you a better debt/available credit ratio, which is a good thing for your score

DVD Josh · 02-14-08, 12:30 PM

Normally, I suggest keeping open accounts. The damage is done to your credit already.

However, you get none of the benefits of a new account (increased limits) nor account age.

The impact to your credit will be practically nonexistent.

HOWEVER, given your credit history, it may be difficult to get a better card until you've proven your credit worthiness. If it were me, I'd use the card for three months, paying off on time each month. Then I'd call CS and ask for credit increase.

Who knows, in 2 years that card might be your highest limit card.

Dr Mabuse · 02-14-08, 12:44 PM

keep the card...

canceling a credit card damages your Fica score...

DVD Josh · 02-14-08, 12:48 PM

Quote:

Originally Posted by Dr Mabuse

keep the card...

canceling a credit card damages your Fica score...

The damage is already done by opening the card.

Only two things can happen:

1) Nothing

2) Whatever bump in his AC ratio he got from the card will return to where it was.

Closing THIS card will not damage his score.

02-14-08, 10:35 AM	#1
Mongo DVD Talk Special Edition Join Date: Jan 2000 Location: Back home in Maine! Posts: 1,611	FICO score vs. account age First off...Hi all. Haven't logged on here in about 2 years. I was living in hicksville and only had dialup, and slow dialup at that. Finally moved back to Maine a year ago and got DSL....but never got around to coming back to the otter farm until now when I need your help. Ok, now on to the real question. I had pretty poor credit at one point, but over the last few years it's been getting better, and during the last year or so it's started moving up a decent amount due to some loans etc that I took out for the express purpose of strengthening my credit history. Yay me! So, along the way I've picked up a few credit cards as well (Amazon card being my 'daily use' card for the GC's) A month or so ago, I decided to go ahead and accept an offer for another card and signed up for it online. Well, the credit limit they gave me is....useless, lol. Honestly, I see no point in keeping the damn card, however, I'm worried that if I cancel it after only having the account open for a few weeks that it'll ding my FICO score which I've been working so hard on improving. So which is my best option? A) Cancel card even though it's only a couple of weeks old. B) Keep the card, but 'forget' about it. Since the credit limit is so low I assume it's not going to hurt me much. C) Other? And now that I've come back to ask this one thing....I'll probably end up being around a whole lot more. It's kind of like peeing when you're drinking beer. You can hold it for a long time at first, but once you cave that first time you're running back for more every 10 minutes.

02-14-08, 12:30 PM	#3
DVD Josh DVD Talk Legend Join Date: Dec 1999 Location: In My Own Little World Posts: 19,355	Normally, I suggest keeping open accounts. The damage is done to your credit already. However, you get none of the benefits of a new account (increased limits) nor account age. The impact to your credit will be practically nonexistent. HOWEVER, given your credit history, it may be difficult to get a better card until you've proven your credit worthiness. If it were me, I'd use the card for three months, paying off on time each month. Then I'd call CS and ask for credit increase. Who knows, in 2 years that card might be your highest limit card. __________________ *DVDTALK GOLD TRADER* http://www.invelos.com/dvdcollection.aspx/cwrujosh

02-14-08, 12:44 PM	#4
Dr Mabuse DVD Talk Legend Join Date: Jun 2007 Location: 75 clicks above the Do Lung bridge... Posts: 18,848	keep the card... canceling a credit card damages your Fica score... __________________ "The exact contrary of what is generally believed is often the truth." - Jean de la Bruyère

02-14-08, 10:41 AM	#2
GradVT06 DVD Talk Special Edition Join Date: May 2006 Posts: 1,445	B More available credit is a good thing. Also, having the open card with no balance gives you a better debt/available credit ratio, which is a good thing for your score