Does closing a credit card affect your credit?

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asked Mar 5, 2020 in Credit by lauriwillis (420 points)
Does closing a credit card affect your credit?

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answered Mar 5, 2020 by Shawn (99,990 points)
Closing a credit card can lower your credit score and hurt your credit history at least for the short term.

It's always best to keep the credit cards open even if you barely use them and then use them for even small purchases and then pay the balance back on time.

That helps you build a good credit utilization history and shows up on your credit report to other lenders that you're good with credit.

That can help you get future loans such as home loans, business loans, car loans etc.

If you do need to close a credit card only close the credit cards that have a low credit limit and keep the ones with the higher credit limit.

If you have a credit card open with no balance and have used that credit card often and paid off the balance on time then that is good for your credit score and credit history.

When you have used a credit card and paid it on time and have no balance it's best to keep that credit card open so that it shows a good credit utilization.

Even if you use that credit card just sometimes and then pay off the balance every time you use it it helps to build your credit score.

That can help you get home loans, car loans and other credit cards as well as many other loans that you may need.

If you cancel the credit card with no balance it could lower your credit score for at least awhile and then that credit card won't help you build a good credit history anymore.

So keep the credit card with no balance but use it once in awhile to keep the credit card open and then pay off the balance in full to help keep your credit score high.

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