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Multiple 0% Financing Purchases - Will this cause credit score issues?
Posted on 2/23/17 at 8:01 am
Posted on 2/23/17 at 8:01 am
Over the last 10 years we've purchased furniture a few times from different places with 0% options. One was wells fargo and the others were not big name institutions (like American Finance something or other, etc...). They'd open the account for well more than what we were purchasing (essentially opening a $10k credit card for each one). We'd pay off each item with no issues then never use the account again. Anyway, we were purchasing a new sofa this week and there was a 0% option and I got to thinking: does having multiple credit accounts open (with what i assume is $25k-$50k worth of credit) bad for out credit? Should i work to close these old credit accounts? Or just leave them be?
4
Posted on 2/23/17 at 8:09 am to poochie
The largest negative affect these will have are the multiple hard hits on your account. The next hit will be that every time you open a new account, the average age of your account will go down.
The positives is the percentage of credit you are using will go down which will help your credit. If you are looking to make a major purchase (car/house) in the next few years I would look to close some of the newer accounts to raise my average age. If not, there would not be any harm, and some of them usually close themselves with a few years on inactivity (Wells Fargo did that to me after I paid off my mattress).
The positives is the percentage of credit you are using will go down which will help your credit. If you are looking to make a major purchase (car/house) in the next few years I would look to close some of the newer accounts to raise my average age. If not, there would not be any harm, and some of them usually close themselves with a few years on inactivity (Wells Fargo did that to me after I paid off my mattress).
Posted on 2/23/17 at 11:17 am to poochie
First off, your interest rate doesn't impact your score. And I wouldn't worry about activity that's been spread across ten years. If you suddenly open a bunch of accounts within six months, they'll take a closer look.
There is some small risk someone will steal an account number and use it without your knowledge, or maybe charge an annual fee, etc. so keep an eye on them. But merely having an open account won't hurt you and might even boost your score a little.
There is some small risk someone will steal an account number and use it without your knowledge, or maybe charge an annual fee, etc. so keep an eye on them. But merely having an open account won't hurt you and might even boost your score a little.
Posted on 2/23/17 at 11:21 am to poochie
quote:
Should i work to close these old credit accounts?
Absolutely not, it helps your credit not hurts it.
We do the same thing you do, as long as you aren't opening multiple accounts in a month or something crazy, its no big deal. Especially if you have an established credit history.
Posted on 2/23/17 at 12:11 pm to poochie
I've done zero interest financing at least 3 times, paying off 2 of them, over the last 2 years and my credit score is still in the 800s. As long as you don't have any late payments and the zero interest loans don't make up a large portion of your available credit and credit history you should be fine.
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