Is it a good idea to close unused Credit Cards?

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Closing any credit card is not a decision to wander aimlessly into. There are several factors to consider and several things it will affect: closing a credit card will reduce the overall credit available to you; if you carry any balance at all on it, it will increase your overall credit utilization; and depending on the age of the card and number of cards you have total, it may affect your average length of credit history. Credit utilization and age of credit history are both factors in your credit report and thus have an impact on your credit score, so if you close any credit card account, be prepared for a drop in your credit score. If you close your oldest credit card, be prepared for a significant drop in your credit score.

With that said, if you have several cards of similar age AND the reduction in credit line won't significantly impact your credit utilization, closing a credit card may be the right decision for you.

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(11 Total Comments)

I have a score of 740 with 5 accounts out of which 2 are from chase, 1 Gap, 1 Macys, 1 Kohls cards. Since I'm leaving out of country and did not use those cards for quiet a while, I cancelled those store cards Gap, Macys, Kohls. Will this affect my credit score?"

BalajiB at 1:13 pm Jan 12

Unless you have other accounts with a long open history this will probably affect your account. The degree will depend on your overall history.

CK Moderator

My credit report card says I have 12 open cards, but I can only figure out what 8 of them would be. How can I find out what cards are in my name? Also, the amount of debt it says I have does not match my totals. I would like to figure out what's going on so I can fix it."

swhetzell at 6:37 am Dec 31

You can view your detailed credit report at AnnualCreditReport.com. That is the free government site. You can also view it at anytime at TrueCredit (charges may apply).

CK Moderator

My fiance has a couple cards the ones of mention are:

A New York and Co. card that was opened with a credit limit of $500. Only about $80 was charged to this card. Payments were made on time and correct. The card has been paid off for over a month now with zero balance.

Citi card through Rooms to Go (which they don't offer anymore they offer their own branded card)The Citi card has a $7500 credit limit on it with an available balance of $4185. This card is paid on a monthly term on time each month.

The question is for card one. Would it be better to close the account (Its only a few months old with other cards that are open with years on them) or lower the limit from $500 to say $25-$50 since she doesn't plan to use it anymore.

The second card would it be benificial to lower the Citi card to $3500 since the due amount is $3300 something.

All to open more available credit for her to have the options to apply for more cards in the future. She has tryed to in the past and always is turned down with a letter in the mail a week or so later with the usual too much tied up credit notice. With closing the first or substantially lowering it and lowering the 2nd it would seem she would free up about $4500-4700.

Also how long would these changes take to show on her credit when applying for more? Can this process be accelerated via calling the credit buero (sp) or something?

Also any links for credit building credit cards for those with bad credit. My ex wife trashed mine and I've been fighting to clear everything up. Of course unfortunatly I have a foreclosure on mine since she commited adultry and left me to pay all the bills which I just couldn't do even working 2 jobs basically around the clock."

scgt1 at 9:41 am Dec 18

What should I do to make my score increase? My score right now is 698."

vicvic1980 at 7:14 pm Dec 16

Use our credit report card. Simply try to improve your bad grades to good grades. In so doing, you should see your credit score increase.

CK Moderator

I have great credit, but was given a grade of "F" when it came to the number of cards I have or had. I have had 10 credit cards, 5 remain open and 5 are closed. What do I need to do to improve this?"

Roxxychic98 at 1:03 pm Nov 4

If you are happy with your score, do nothing. Some people obsess with perfect credit scores. If you are one of them, then moving more grades to A's will help. Keep in mind there is no benefit to a perfect score versus anything 750+

CK Moderator

There was a card company on campus giving away shirts to those who filled out applications. The reps explained the card company would just send offers by mail and then you decided to open or not. I never received the offer an forgot about the whole thing

I recently discovered that I had a credit card with them for almost two years before they closed it (due to inactivity im sure). Reports as open with no balance/no payments for the duration. Would it be beneficial to have this erased from my history since it was never used??"

tplavery at 6:51 am Oct 25

You can't really erase it since it was technically issued. The effect either way was probably negligible.

CK Moderator

I was recently told from walmart card services that after 4 months of on time payments I can request a credit line increase. Should I do this every chance I get? Also, this card account was given to me in Jan. 2009 with a $400 credit line. Without warning it was reduced to $140. I paid usually in full every month. They honored my request for an increase. They increased it by $100 to $240. That is great. Usually I don't need credit because I don't believe in paying interest/finance charges. I have a Paypal business debit/ that can be used/ran as credit linked to my checking and thus earning 1% cash back. That's great too. It used to be even better when opened it because it earned over 5% at one point 2007-2008. Then I would transfer from my checking to Paypal and just use the Paypal card. Hope it gets back to them days."

baird2100 at 3:31 pm Oct 8

I have approximately 14 credit cards with very little to zero balance on them. A couple of them have such a low credit line that it's not even worth keeping open, esp. since it has an annual fee. It is one of my older accounts though. Should I keep it and pay the annual fees or close it?"

Litllam88 at 10:13 am Sep 22

If they have an annual fee, then you should generally close them. Of the ones you decide to close, cancel the newest ones first since the old ones help build your credit history. Wait 30 days between closures and check your score between closings to see the impact of each. Stop canceling cards if you think you credit score is going down too much.

CK Moderator

I noticed that the score tracks the number of closed credit cards. How does this negatively affect my credit score? Can you get the closed cards removed? If so, will that negatively affect my score. I have a great score but 10 closed accounts. Several of them were closed by the creditor when the company went out of business."

CindyinAtl at 8:13 am Aug 30

Closed accounts don't lower your credit score. It is the shortening of your credit history that lowers your credit score. Generally, there is nothing you can do about lenders that go out of business but that is part of the reason to have a few different credit cards .

As for removing closed accounts from your credit report, it is not something that you can do unless the data is inaccurate.

CK Moderator

This is a very interesting question to me, as I am pondering the same thing. I have a credit card with a very large credit line to a small store that I utilized to purchase a good vac. cleaner. It was a year of no interest, I paid it off and no reason to leave it open. So, should I close it and is there a "proper" way to close it so that it doesn't negatively impact my credit?"

Shine40 at 12:53 pm Aug 21

If you have many old cards and good credit. Closing this card shouldn't be a problem. If not, then consider keeping it open provided it has no annual fees.

CK Moderator