Cancel credit card ?

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I want to cancel a Visa that I never use (from Bank of America, tfui, tfui). I searched long and hard on their Web site to find a link, and finally came across the following:
http://tinyurl.com/48p2qo7
They "threaten" that cancelling a card might lower one's credit score. ??? Is this true? Or is it a marketing gimmick?
Your real-world experience valued.
HB
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On 01/16/2011 09:56 PM, Higgs Boson wrote:

it is somewhat true. you have to have some credit in good standing for a really high credit score. they also look at things like debt to credit ratio.
I've heard tell that occasionally using a credit card but always keeping it paid off every month is the best strategy for keeping ones score high.
nate
--
replace "roosters" with "cox" to reply.
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That's exactly what I do. I NEVER carry a balance on any of the three cards* I have ( four, with the new Visa). They hate people like us, nyah, nyah, nyah.
*of which I was proposing to cancel one. So is the consensus that I just should let it sit there, unused, rather than cancel it?
HB

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If you don't carry a balance, and don't use up much of your available credit, then dropping one should not make any significant difference.
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On 1/16/2011 10:24 PM, hr(bob) snipped-for-privacy@att.net wrote:

And what does it really matter? To get an uber good credit score you have to totally run your financial life their way. Don't plan for any purchases by saving, buy things you can't afford and carry a balance but just make sure you pay it on time.
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I think that's wrong. The way it was once explained to me is that part of the score is based on how much you owe compared to your total credit lines. So, cancelling a card that gives you a $5k credit line will up your percentage owed compared to your total credit. That assumes, of course, that the OP owes any balance. Of course, you always owe a balance since you use the cards, even if you pay it all when due.
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The various opinions and experiences on this thread are all very interesting, But I wonder if there has ever been an objective study done of exactly WHAT is the attitude of the banks toward cancelling cards and opening others. The assumption is that user is debt-free, pays on time, does not exceed limit, and does not have an inordinate number of cards. Surely SOMEONE or some entity has studied this?
HB
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Higgs Boson wrote:

Certainly seems like an obvious and interesting question.
I would try asking a realestate agent. They deal with credit and credit scores to get a mortgage. They should be real aware of what influences the scores.
Wikipedia maybe?
--
bud--


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Don't think anybody has the ability to conduct an objective study, other than the three credit bureaus that keep that data as proprietary.
The banks themselves don't do independent analyses of this, they take the credit score itself, plus your income, asset and debt levels, to decide on credit.
The credit bureaus say that they look at how much you owe vs. total credit available- in other words, are your credit cards maxed out, or do you use them only a little.
So it seems that if you have ten credit cards each with a $5000 limit and you owe $5000, cancelling one won't make that much (or maybe any) difference (owing 10% vs. 11%). But if you have only 3 of them and cancel one, then you've gone from 33% to 50% and that's a big change.
Note that usage includes what's outstanding when they measure it- so if you use your cards a lot but pay them off every month you will still show some 'debt.'
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On Sat, 22 Jan 2011 07:15:23 -0800 (PST), Shaun Eli

Certainly they do. You said it yourself, they take your income and assets into account. They often have real people analyze the risk, too. FICO is just one input.

Yes, it's rather surprising that they don't show revolving debt, but they don't. One can infer it, with reasonable accuracy, fairly easily, though.
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I had a boss who would say "Stop using pronouns" to avoid ambiguity.
I meant that banks take the FICO score as one input. They don't independently analyze what goes into THAT, the FICO score. They use the credit score and other data. But they don't dissect what goes into the credit score.
They may have real people look at an application for serious amounts of money (mortgage, etc.) but credit cards? I have applied on-line and gotten approval as fast as my screen refreshes. No people there, probably a formula using credit score and whatever I told them about income (they don't seem to ask about assets, only whether you have a bank account, and what type(s) plus what my rent/mortgage payment is).
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On Sat, 22 Jan 2011 11:12:53 -0800 (PST), Shaun Eli

If they thought there was a need to reanalyze the FICO score why would they pay good money to FICO for the score?

That depends on the bank, and the customer.

Of course not. A bank may question and rethink a marginal score, particularly from a good customer, however.
The bottom line is that the FICO score is one of the tools available to banks. Nothing more.
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On 1/16/2011 10:21 PM, Higgs Boson wrote:

Ignore it long enough, and their computer will cancel it for you. You'll get slammed to a different card, or they'll just never send a new one when that one expires.
--
aem sends...

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Higgs Boson wrote:

Keep it. They're only going to charge you $5-15 per month handling fee.
On the other hand, a poor rating from BoA will be ignored by everyone else.
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On 1/16/2011 10:21 PM, Higgs Boson wrote:

They just don't like as as much. Since they are still inserted into the transaction they get to collect the non-trivial merchant fees which the merchant is not allowed to display.

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-snip-
Zackly-- I haven't paid any CC interest in a decade. They pay me about $100 a month in rewards. My credit is excellent- I don't know the numbers, I just see the dealer's face light up when I go for a car loan.
Jim
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-snip-

Juggling 4 cards, I get [this quarter] 5% on gas, 3% on Amazon, 5% 'in a grocery store' , 1-2% on anything else--- plus all the 'we're dying to have you as a customer' bonuses. If it is over $20, I'll bite. I've gotten $100 several times, $50 is common.
They slowed down for a while- but the past few months have picked up again.
Jim
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That's a double-edged sword too.
If you don't use the card, they start dropping the credit limit on the card, which hurts your credit score too.
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On Jan 17, 1:09pm, snipped-for-privacy@rochester.rr.com wrote:

Sheeeeet! They get me comin' & goin'!!! Damned if cancel, damned if I keep and don't use. I don't like the bank (B of A), which is one reason I got a new Visa from another bank. I hate to kiss B of A's royal *** every so often if only for a $10 purchase to keep THEM from dropping ME -- if I'm understanding how this works.
Are you SURE they "start dropping the credit limit on the card"? Why would they do that?? Anybody have real-world experience on this one?
TIA
HB
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On 1/17/2011 8:49 PM, Higgs Boson wrote:

It's never happened to me, and I do play games with the CC companies to get the incentive then never use the card again. I let them go a year or two then when I look at my credit report, I decide to cancel two or three I didn't even remember having.
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