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Cancelling a credit card and its impacts
Posted on 1/19/17 at 11:47 am
Posted on 1/19/17 at 11:47 am
Sorry if this has been discussed. I'm a first time money board poster. Here's my situation. I have a chase freedom card that I use for everything. I opened a chase southwest card last year because I was travelling a lot for work and wanted to capitalize on the offer for 50k points and then additional points when using my card for travel. So it was used only for work. However, my company has changed travel policies and I don't get to use a personal card any longer. Will cancelling the card impact my credit score. Is there any negative to cancelling. I need to take action prior to having to pay the $99 annual fee. Thanks for the help.
9
Posted on 1/19/17 at 11:54 am to lsugrad35
Very little, if any impact. They may even have an option for you to downgrade to a card with no fee.
I would be PISSED if my company did that. If you travel for work and hit the bonuses correctly, that's worth at least $5,000 per year of flights and hotels.
I would be PISSED if my company did that. If you travel for work and hit the bonuses correctly, that's worth at least $5,000 per year of flights and hotels.
Posted on 1/19/17 at 11:57 am to I Love Bama
quote:
I would be PISSED if my company did that
Yea no joke. We now have a travel company that books everything for us. The cheapest flights and everything. No regard for the employee its all about the money.
Posted on 1/19/17 at 12:35 pm to lsugrad35
It would probably ding your score a little bit temporarily.. If this is only your second credit card, I would suggest seeing if they will let you downgrade it to a Chase Freedom Unlimited. This will help your score in the long run (more accounts and higher average age of accounts). It's also probably a better all around rewards card than the Chase Freedom if you're using it for everything and not focusing on category bonuses.
Posted on 1/19/17 at 12:54 pm to lsugrad35
I'm fairly certain you will so no change to your credit score.
Posted on 1/19/17 at 1:19 pm to lsugrad35
I just did the same thing recently. Had a card that I opened two years ago for international travel (World MasterCard from USAA). Now that Costco doesn't accept AMEX, I needed a Visa option w/ cash back. I don't expect to see too much of a ding although they had me at relatively high limits. I was at 806, so I doubt it sends me below 800. We shall see...
Posted on 1/19/17 at 1:24 pm to TheWiz
quote:
I was at 806, so I doubt it sends me below 800
Subtle brag.
Posted on 1/19/17 at 1:36 pm to lsugrad35
it will affect the available limit, % of credit used, and average history.
If they will let you downgrade to a free card then do that.
If they will let you downgrade to a free card then do that.
Posted on 1/19/17 at 3:16 pm to lsugrad35
I would try to transfer it to a free card like Slate. Your credit score does take into account total available credit, % of credit used and length of accounts. If this is your only card, all of those will be impacted.
Posted on 1/20/17 at 11:22 am to seawolf06
quote:
would try to transfer it to a free card like Slate. Your credit score does take into account total available credit, % of credit used and length of accounts. If this is your only card, all of those will be impacted
I agree with this. It's one thing if you are in the credit card game and you have $100k+ of available credit. Dropping one card won't impact your score. If your 2 cards have the same limit, dropping one reduces available credit in half. Aside from the score, having a spare credit card is a good idea in general.
Posted on 1/20/17 at 9:57 pm to lsugrad35
It might dent your score slightly but not much unless you just don't have much available credit otherwise. And even then it's minor compared with the really big stuff like being 30 or more days late on a payment.
Posted on 1/21/17 at 10:51 am to lsugrad35
quote:
then additional points when using my card for travel. So it was used only for work
Thats the one thing I wish my company did, allow me to put travel expenditures on personal card and then get reimbursed... I'd have SOOOOO many more points than I currently do
Posted on 1/21/17 at 4:45 pm to lsugrad35
My bank website had a credit score tool. You could input possible changes, such as cancelling an account of so many years, adding a card, being late on a payment, etc., and it would show you the anticipated effect on your score.
Cancelling cards had almost zero impact on my score.
I really did later drop one that I'd had for 20 years and saw no change.
Cancelling cards had almost zero impact on my score.
I really did later drop one that I'd had for 20 years and saw no change.
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