Hello all, I was offered a credit card with a 300.00 limit 3 years ago when my score was little messed up. However I now have an avg score of 715 on the least side. So this card, I spite of my repeated requests does not reduce my APR, nor ad any benefits for using this card and also charges annual fee. My question is is it good to cancel this card? I know this will reduce my avg life of credit, but is there any way I can either ask him to reduce the APR, increase the credit line (I currently have 950.00 line of credit on this account) and add more benefits to it like rewards program etc.. BTW I am not using this card often nowadays. Please suggest me how to deal with this card. Thanks Seekinfo
Hi seekinfo. Welcome to Creditnet! Which card is it exactly? It sounds to me like it's time to upgrade to a better rewards card and finally kiss the old "credit card for bad credit" goodbye, even if your FICO scores will take a bit of a hit.
I agree with Josh. I would close the credit card with the $300 limit. Besides the three years for payment history you have established it is not benefiting you in any way. Really it is just costing you money with it's annual fee. I would move forward with your other credit card and take a temporary dip in your credit score by closing this card. Thanks! Heather with BoostMyScore.NET
I agree with you and Josh. However, my question is; if the credit card is closed how long will the temporary dip in the credit score will last? What factors can pull it up again? Thanks.
Unfortunately, the OP hasn't given us any more detailed information, but my assumption is that closing this card would mainly affect both the length of his credit history and his overall credit utilization ratio. It's difficult to say how much his credit scores would drop, but if he has other open lines of credit and credit cards of similar or older age then the drop might not be that much. Adding a new credit card with a comparable credit limit to the mix before closing the old card would be a good idea. Both the additional credit limit and the new payment history would help the scores recover and even improve within 3 months or so.
You may opt to ask the card company to add your credit limit as well as provide with incentives. However, since you said that you are not using the card often, you may want to apply for new credit card. When applying for new credit card, make sure you make the right choice of credit card with higher credit limit and other benefits such as zero APR, no annual fee, rewards, balance transfer, and other features for your advantage.
