Hello, I was hoping someone here could help me. I had credit score of 719. Recently I opened some new CC accounts and my score dropped to a 693!! The reason Equifax stated was some accounts were to new to rate. I don't need these credit cards and will gladly cancel them. But will they still effect my score after they have been closed. How does that work? If anyone could shed any light on the situation or point me to a discussion where this is covered ( i searched but did not find any) It would be most appreciated. Thanks in Advance!
Opening new credit accounts will lower your score. Closing accounts will likely lower your score further. I would just establish a payment history with them
inquiries lower score, but by keeping these cards and establishing a good payment history with them it will over time raise your score, and the drop in your score is temporary so unless you are financing a car or getting a mortgage just keep the cards establish a good history with them and watch your score go back up.
Do not close any accounts; try charging a couple of bucks a month on these cards even if you don't need them, keep them for at least 2 years and then close them if you don't need them. FICO likes to see ideally at least 2 years on any open-ended account (credit card)
Thank you everyone for your advice. Ironically I am closing on a re-finance on July 10th however they have already run my credit for that. Also I am in the process of trying to buy a car shortly after the closing. How temporary is the drop in score? 1 Month, 6 months? I guess i will keep them but I wish that my score would stay above 700. On a side note why is it viewed as a negative to have inquiries into your credit. What is the rationale? If you pay all you bills and have a good debt ratio frankly who cares how often anyone does an inquiry. I could understand if they were posting negative things. You would think that it would be a positve that people are checking you out so that they could hopefully do business with you.
Re: Re: Closing Accounts, Help My score? Too many inquiries in a short period of time show a creditor you are trying to obtain credit. Too many inquiries and you look desperate for credit.
Re: Closing Accounts It may take a few months for a new account to show up on your credit reports. In the meantime, inquiries tell a lender that your debt load could be more than the reported accounts would indicate. Lowering your score for inquiries theoretically helps adjust your score for the extra risk. That is the only FAIR use of inquiries, and it makes them relevant for a few months, perhaps as long as six months. But any score or model that looks at inquiries over a year or two years is simply an attempt to justify excessive interest rates: "the FICO Factor."
