Quote:
Originally posted by LoveMyKeyKKG
Does anyone know if it is wise to close unused credit card accounts if you are trying to improve your credit score?
My credit card companies keep raising my available credit and now I have more than $40,000 worth! Will that hurt me when I apply for a mortgage in about a year? I've heard that you are seen as a risk if you have too much available credit.
Other than that I have low balances on my cards that I will have paid off in the next few months, I always make payments on time and have a decent credit score. I plan to buy a house in about a year and a half.
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Having too much open credit can be seen as a risk. Closing accounts that aren't used isn't the best idea to do either. You could close one or two within the next six months or so but if you close five or six within that same time frame then your score may take a tiny tiny hit.
Of course these are just very minor things that shouldn't be reflected a year away when you are considering to buy a house.
Another tip about paying credit cards. If you have paid credit card bills late it doesn't mean that it will look bad on your credit score. Many credit card companies will not report you to a credit bureau if you make a payment within 30 days of the original due date. Other companies will give you a "grace period" of 60 days. Some credit unions will also give you an extended grace period.
Most banks and lending companies will report you if you pay one day late (beyond grace).