Credit score - Closing account?

[ripvanwinkle]

About ten yrs ago I refi'd my home with Wells Fargo. If I opened a checking account I got .25% lower rate. I also opened a Visa card with them. I refi'd again 4 mo ago with another bank and got a 2.65% rate.

I still have the Wells Fargo Visa card and the checking account but I don't use either. I've been thinking about closing both. But my credit score will probably drop a few points. My score is 832. I have other cards and a Chase checking account I use regularly.

Is it worth closing the Visa card and the checking account? The Visa card had a $5000 credit limit.My last credit report showed I only use 3% of available credit. 

[justme]

From what I know anything over a high 700 (close to 800) is mostly a wash. Meaning someone with a 820 isn't getting anything more than someone with a 800 except maybe a "whoa that's high" remark.

Unless you only have like 1 or 2 other credit cards the odds of losing this isn't going to do much. Assuming it's not a large chunk of your available credit nor one of your oldest cards.

[alabamagal]

Feb 24, 2021 0:32:48 GMT -5 justme said:

From what I know anything over a high 700 (close to 800) is mostly a wash. Meaning someone with a 820 isn't getting anything more than someone with a 800 except maybe a "whoa that's high" remark.

Unless you only have like 1 or 2 other credit cards the odds of losing this isn't going to do much. Assuming it's not a large chunk of your available credit nor one of your oldest cards.

Agree with all. Most places where credit scores are used only look at ranges. Credit scores don’t look at checking or savings accounts. For credit cards they look at number of accounts and % utilization. So you may take a small hit in your score, but it won’t matter much. I am about simplification so I like to close accounts I don’t use.

[NoNamePerson]

Personally I wouldn't keep an unused checking account open for any reason. But that's just me. I've closed a CC and my credit score took a two point hit. No big thing since I had high score to begin with. I figure unused CC and checking account is just waiting to be hacked  I'm surprised the bank isn't charging you for the "unused checking account"

[chiver78]

you sound like my friend M. she's in limbo trying to buy a house that was a foreclosure, and her rate lock expired. she's pissed that her credit score dropped to like 804 from 810 when she paid off her car, as if that's going to severely impact the 2.9% interest rate she had locked in before. 

seriously, though. what justme said is spot on. I've got a lot of accounts that I need to close in the next year or so, I want to do it all in one shot so it's not a bunch of little hits. one that I am absolutely keeping is my American Express - my oldest account, opened my freshman year in college b/c I wanted a free t-shirt.    the rest, I'm still considering which to keep.  

[wvugurl26]

My aunt's rate lock was going to expire and they wanted her to pay more to keep it. No can do since it's the bank's multiple screw ups that have delayed closing.

The cards I would ditch are some of the oldest and $20,000 limits. Some day I'll get rid of them.

[CCL]

Feb 24, 2021 7:57:49 GMT -5 chiver78 said:

you sound like my friend M. she's in limbo trying to buy a house that was a foreclosure, and her rate lock expired. she's pissed that her credit score dropped to like 804 from 810 when she paid off her car, as if that's going to severely impact the 2.9% interest rate she had locked in before. 

seriously, though. what justme said is spot on. I've got a lot of accounts that I need to close in the next year or so, I want to do it all in one shot so it's not a bunch of little hits. one that I am absolutely keeping is my American Express - my oldest account, opened my freshman year in college b/c I wanted a free t-shirt.    the rest, I'm still considering which to keep.  

I wouldn't close an American Express, either. I love mine, even if I do pay a $95 fee. They give me a lot of freebies.

[CCL]

Feb 24, 2021 8:01:25 GMT -5 wvugurl26 said:

My aunt's rate lock was going to expire and they wanted her to pay more to keep it. No can do since it's the bank's multiple screw ups that have delayed closing.

The cards I would ditch are some of the oldest and $20,000 limits. Some day I'll get rid of them.

Why close the oldest?

[wvugurl26]

I'm not closing the oldest since it is the oldest. But if I were picking based on benefits, it definitely has some of the worse ones. Better than nothing at a straight 1.5% cash back but not as good as 5% or the Marriott card benefits.

[minnesotapaintlady]

If it's one of your oldest cards I'd be careful.  I was closing things willy nilly a few years back and accidentally closed one of my older ones and my score took way more than a few point hit.  It was more like 30 points.

[justme]

Feb 24, 2021 8:01:25 GMT -5 wvugurl26 said:

My aunt's rate lock was going to expire and they wanted her to pay more to keep it. No can do since it's the bank's multiple screw ups that have delayed closing.

The cards I would ditch are some of the oldest and $20,000 limits. Some day I'll get rid of them.

I had that happen. I kicked up a fuss and it was on a foreclosed place too. Someone paid for the extra though and it wasn't me. Not sure who exactly though, I think the broker and my agent.

[chiver78]

Feb 24, 2021 9:05:27 GMT -5 CCL said:

Feb 24, 2021 7:57:49 GMT -5 chiver78 said:

you sound like my friend M. she's in limbo trying to buy a house that was a foreclosure, and her rate lock expired. she's pissed that her credit score dropped to like 804 from 810 when she paid off her car, as if that's going to severely impact the 2.9% interest rate she had locked in before. 

seriously, though. what justme said is spot on. I've got a lot of accounts that I need to close in the next year or so, I want to do it all in one shot so it's not a bunch of little hits. one that I am absolutely keeping is my American Express - my oldest account, opened my freshman year in college b/c I wanted a free t-shirt.    the rest, I'm still considering which to keep.  

I wouldn't close an American Express, either. I love mine, even if I do pay a $95 fee. They give me a lot of freebies.

I think I do, too. I get the higher points rate on the blue card, so probably I do. I used to pay the $95 on my first corporate card, so I could get the points for all the business travel I used to do. when I stopped travelling, I cancelled the rewards on the corporate card and converted my personal one b/c it was essentially a wash.   ok yah, I have to be paying the $95 then. lol.. 

[TheOtherMe]

I would not close the oldest account.  Age of account is figured in to the credit score.

[Tiny]

I would close out the checking account - I'm guessing you have to maintain a minimum balance and/or have a monthly deposit (like from your paycheck) to it to keep it a "free" checking account. Why have money not working for you?? If it is an interest bearing account - are the pennies per month worth it?

I just paid off a 30y mortgage with Bank of America that I had taken 11 years ago. I had opened a checking account at the same time because it gave me some fraction of a percent off the mortgage rate and I felt having a separate account for this mortgage would be useful (it was a rental property) Now that the mortgage is gone and I can consolidate this rental property $$ into another account that I use for 'rentals' I closed the Checking account. I saw no reason to tie up 1750 minimum balance and I no longer needed to have an payroll deposit to the account. I wasn't getting interest on the checking account.

I kept the BoA Credit Card - I use it (rotate it in depending on the quarterly rewards I get with my other cards).

In your case - I would look at the limits on the cards you are using... you want your utilization across all your cards limits to be under 10% without the wells fargo card you will close.

If the wells fargo card is the oldest by a lot of years I might opt to not close it. (so if your oldest line of credit is 10 years old and your next oldest is 3 or 4 years... closing that 10y card may cause a bigger hit to your FICO. My oldest card is 30 years - my second oldest is 27years and then they drop into the 15y range... I suspect closing the oldest in my case would have little effect on my FICO.)

My over 800 credit score doesn't seem to do much for me - other than get a "wow! that's a high score" I think as long as you are 760 or higher you are good to go.

[Ryan]

My credit score is usually right above 800 or so, but I noticed that it takes pretty large swings when I refinance.  Both Transunion and Equifax drops close to 50 points for a short period of time, not sure if it's because of hard credit inquiry or the brief amount of time that I don't have a mortgage showing.  It usually bounces back after a month or so.  

I typically only have 3 credit cards and a mortgage, I haven't had a car loan in quite a few years so maybe the lack of installment loans is hurting me.

[The Walk of the Penguin Mich]

When I got my denial letter from Chase for a cc that I had not applied for, I looked at all my credit reports.  

Right now I have 3 major cards, Visa, MC and AmEx with a combined credit l8mit of $50k.  Everything else I had substantial is shut down.  For smaller cards, I retain Talbots, Kohl’s and VS (and I’ll probably close this one too).  

My car loan was paid off in 2012, and that was my last installment debt I had.  My credit score is in the high 700s.  Since I don’t need anything, I’m not chasing a number and don’t really care.  

I do think it’s interesting that the reasons I was denied that cc was not enough debt experience and revolving debt too high (but still trying to figure out why 0 is too high).  I have over 30 years on these cards, one nearly 40 years.  With this sort of logic, why chase something this illogical?

[dondub]

Feb 23, 2021 23:56:28 GMT -5 ripvanwinkle said:

About ten yrs ago I refi'd my home with Wells Fargo. If I opened a checking account I got .25% lower rate. I also opened a Visa card with them. I refi'd again 4 mo ago with another bank and got a 2.65% rate.

I still have the Wells Fargo Visa card and the checking account but I don't use either. I've been thinking about closing both. But my credit score will probably drop a few points. My score is 832. I have other cards and a Chase checking account I use regularly.

Is it worth closing the Visa card and the checking account? The Visa card had a $5000 credit limit.My last credit report showed I only use 3% of available credit. 

Close them both. With your score you have nothing to worry about.

[ripvanwinkle]

Thanks all. I went and closed both. One less piece of plastic in my wallet. I'll see how much my score drops. Not worried though with a score of 832.