What CLOSING a Credit Card Did to My Credit Score...

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[fredkinney]

I just closed a credit card with a 500.00 dollar amount. But I applied for a Chase card and got a 14 thousand dollar limit

[SpencerJohnsonOfficial]

I never considered the fact that closing your newest account could raise your average age of accounts. I guess that only makes sense! Of course, it seems that's only the case with specific credit scoring models, but still cool to see how little your score was affected overall. Thanks for sharing Ben!

[ShaferScott]

Follow up video idea, “What maxing out all my credit cards did to my credit score”.

[SaturnV]

I remember a few months ago I did a large Amex transaction and it was about a week before my monthly credit score was updated. Wouldn't you know it my FICO score dropped 26 points. Needless to say I made sure the balance was paid before the next FICO score update and yes it went back up 26 points on the next cycle. You'll see a temporary decrease but if you pay off the transaction or significantly decrease the balance your credit score will bounce back.

[todd]

If you have multiple cards with the same bank you can usually move your credit around. Before you close a card move the credit to another card that way your utilization won't change or it will be very little because cards usually have a Minimum like $500 so you can move it all but that amount before you close it

[fogrunr]

In your scenario with the three Chase cards, the minimum credit limit on each of the two Freedom Visa Signature cards is $5, 000. For the card you were closing, transfer all of the credit limit that is over $5, 000 to one of the other cards. And then go ahead and close that one with the $5, 000 credit limit. That will minimize loss of available credit.

[mikeyoung]

Why not pay your card before the statement before the statement closing date

[VincePolevault]

What I'm hearing is yes it does drop your score, even if you try your best to minimize it by understanding and properly adjusting your credit utilization and by canceling cards that have an open account life that is less than your average open account life.

[ggdatboi]

Synchrony just closed 2 of my cards for inactivity lol My Lowes and Newegg cards which I had opened up to make some big purchases. Paid the stuff off and didn't use them for a year. Got emails/letters saying they were closing them due to inactivity and my score dropped like 50 points lol

[PurpleDrazi]

Re: cancelling card & effect on utilization . . . if you can, transfer some (if not all) of the credit limit from the card you are cancelling to another card.

[cbar]

To low or zero utilization will affect your score as well. I was like you and kept mine under 5% utilization. I would always hover around 780-805. I wanted once before I died to see at least one of my scores at 850. It was actually a mistake that made that happen. I forgot to pay a bal. off on my Cap One before my statement end date. That put me at a little over 20%. That's when my scores really started to stay in that 820+ range. Seems like 20%-25% utilization is the sweet spot for me.

[LalitDevraj]

2:25 Imagining if I was new to the channel, and I'm like, who is this "Credit Shifu" Ben Hedges is taking about? 😅😅😁😁

[jeffscalfano]

I like how the Smart Investment app example has the banks and loans labeled as Gringott's. The Harry Potter bank

[wickedcrypto]

what happens when you don't close it but the bank does? I have a credit that I didn't used for an year. I had it all paid up on time and this happen.

[aadeorukhkar]

I just watched your “credit card collection” video and I was wondering if you can max out 5% categories on THREE freedom cards. It seemed very difficult task, and here you have it! Good decision on cancelling it.

[alexrod]

Thank you so much ..for this info...I have fixed my credit by watching video like yours ....Thanks, Again.

[macbeliever]

Still kinda confused as to why you’d cancel a no annual fee credit card, and a freedom card to boot.. what’s the advantage other than slightly increasing the average age of accounts?

[aeromotive]

im stuck in an old fee card .. old for me and high credit limit - a Barclays Arrival. It pretty much sucks as card. I did use it to enter a Fast lane at an Italian airport recently so there's that. No downgrade path, I checked. I guess Im stuck with it

[FinanceConsumer]

i closed my credit 2 co sign credit cards with capital one it went don 9 points

[floydbanks]

It's clear how to figure out the average age of one's ACTIVE CREDIT CARD accounts BUT, how do the cards that ARE CLOSED in good condition factor into the AGE of ACCOUNTS, IF AT ALL. Different types of closed accounts show on my reports from all 3 bureaus, yet none of that same information is available on all 3 reports.