I have about 20 credit cards and have just applied for a new one because I was approached at a shopping center and was offering a $25 bonus. I use one credit card mainly, and the other credit cards are not used at all. Will canceling the other cards effect my credit rating? I pay the card off on time every month and have never paid any interest in the last 20 years. Which way is best for me? keep all the cards, even the ones I do not use or cancel all my cards except the one I use?
Do I need 20 credit cards or will one do the job.
- Thread starter Doctor Zoidburg
- Start date
Interesting, I always thought that more dredit cards were better for your rating, providing you have good credit to start with, but, a friend went for a mortgage a few years ago, has very good credit along with several credit cards, in order to get the mortgage, he & his wife had to cancel some cards, even though they ave great credit. The reason given was, with the CC's, they could rack up alot more debt, & not be ale to pay off ,,, however, they have since added back to the list of credit cards they have!
So, Just to satisfy the BAnk they had to give up some cards, but Credit card companies must be less stringent with loaning than banks are...
So, Just to satisfy the BAnk they had to give up some cards, but Credit card companies must be less stringent with loaning than banks are...
I believe simply applying for a credit card can affect your credit rating. Having 20 is ridiculous. Plus having all that potential debt is also bad for the rating.
Do you really need the free mug/t-shirt that badly?
Do you really need the free mug/t-shirt that badly?
You should definitely cut down. Too many cards means too much potential credit and too much of a potential credit risk.
I used to be the same way and had probably close to 10 cards. I've rationalized down to 3 or 4.
Having credit cards helps your credit rating, especially if you're using them and paying them off on time. Having too many cards, on the other hand, hurts your credit rating.
You should be cutting back if for no other reason than to limit your liability should someone steal your cards.
If you're going to be applying for a mortgage or car loan, I'd talk to someone at a bank to get a good sense of how canceling will affect your rating. You probably don't want to cancel a bunch of cards right before seeking a loan.
The other bonus of canceling cards is that you can get better deals from the cc companies when they try to win you back. Then just keep the cards with the lowest rates.
I used to be the same way and had probably close to 10 cards. I've rationalized down to 3 or 4.
Having credit cards helps your credit rating, especially if you're using them and paying them off on time. Having too many cards, on the other hand, hurts your credit rating.
You should be cutting back if for no other reason than to limit your liability should someone steal your cards.
If you're going to be applying for a mortgage or car loan, I'd talk to someone at a bank to get a good sense of how canceling will affect your rating. You probably don't want to cancel a bunch of cards right before seeking a loan.
The other bonus of canceling cards is that you can get better deals from the cc companies when they try to win you back. Then just keep the cards with the lowest rates.
No I do not need the mugs or T-shirts.
What usualy does it for me is the Good looking girl that signs me up, It works realy well when they wiggle their tits at me. The other way to do it is to give me $25 (or more) worth of free gas or credit on the card. I guess I will cut down to the 1 credit card.
ScoobyDootoo said:
What usualy does it for me is the Good looking girl that signs me up, It works realy well when they wiggle their tits at me. The other way to do it is to give me $25 (or more) worth of free gas or credit on the card. I guess I will cut down to the 1 credit card.
Too many cards?
You could take the card and the gift and then cancel the card but do not kid yourself that it is as easy as it sounds. You need to cancel the account and have the credit card company respond with a confirmation that they indeed have canceled the card. Simply cutting the card or not using it does nothing as your Credit Rating is based on the total amount of non-secured credit you have available and if it is on their books that you have $10,000 available at The Bay that counts as two times bad.. first it is $10k of potential debt and second it is $10k of potential debt at very high interest rates.
So yes get your number of cards down and ensure all others are in fact canceled.
As has been in reported above you really do not want too many credit cards as it in diminishes your credit rating. The supposed magic number is two since it is reasonable to have a back up if one were compromised etc. Certainly if you have an American Express then you want to get either a Visa or MC since Amex still has the lowest acceptance rate due to its somewhat excessive retail charging rate. But there is no point in having four different Visas.Doctor Zoidburg said:
You could take the card and the gift and then cancel the card but do not kid yourself that it is as easy as it sounds. You need to cancel the account and have the credit card company respond with a confirmation that they indeed have canceled the card. Simply cutting the card or not using it does nothing as your Credit Rating is based on the total amount of non-secured credit you have available and if it is on their books that you have $10,000 available at The Bay that counts as two times bad.. first it is $10k of potential debt and second it is $10k of potential debt at very high interest rates.
So yes get your number of cards down and ensure all others are in fact canceled.
If you just cut the card up and don't use it, eventually the cc will mark the account as inactive. That just means you'll have to reactivate before you can use it again. The account still exists and you still have the credit risk associated with it.
I've canceled cards that I never used and were close to 10 years old. The cc company didn't hassle me at all. They just canceled the accounts.
I've canceled cards that I never used and were close to 10 years old. The cc company didn't hassle me at all. They just canceled the accounts.
I had a few cards from the same bank. I called and told them I am using the ones that give me the best reward points--cash 
--and the cards that give me points like at a Days Inn hotel I am not using and to cancel them. They did and even transfer my credit limit to the other card.
So on 1 card I have enough credit to buy a new car with, lol. Good thing I am tight with my money.
--and the cards that give me points like at a Days Inn hotel I am not using and to cancel them. They did and even transfer my credit limit to the other card. So on 1 card I have enough credit to buy a new car with, lol. Good thing I am tight with my money.
I don't have a computer. I'm typing this from a typewriter and I then send the messages to the interweb by telegraph.rayfinkel said:
I've have many credit cards with large credit limits. I could buy a house now.
I knew a guy that used the CC credit as downpayment on houses and pay for renovations and then flipped the house and made lots of money. It was fast, no hassle and the CC companies were happy since he always paid on time and his credit rating was tops.
I knew a guy that used the CC credit as downpayment on houses and pay for renovations and then flipped the house and made lots of money. It was fast, no hassle and the CC companies were happy since he always paid on time and his credit rating was tops.
I work in finance. So take this for what it's worth.
Keep 2 credit cards. One to use, the second as a backup.
Having too many cards has a negative impact on your beacon score (credit score with Equifax of TransUnion).
Cancelling cards prior to a loan will NOT have a negative impact. It will help lower your TDSR.
(your TDSR is your total debt/service ratio. This is a calculation made by taking into account your income vs your current debt. The rule of thumb for a loan is you can't pay out more than 40% of your income to the debt that appears on your credit report. You need to leave room for living expenses, rent (if you don't have a mortgage), heat, hydro, phone, insurances (auto-home), groceries etc.
A TDSR close to 40% requires a co-signer or your shit out of luck.
cancelling cards helps. lowers your risk and is the smart thing to do.
carrying a balance on your many credit cards is the quickest route to financial ruin. If you've already gotten that far, get help sorting out your finances and stick to a plan to get out of the hole.
Keep 2 credit cards. One to use, the second as a backup.
Having too many cards has a negative impact on your beacon score (credit score with Equifax of TransUnion).
Cancelling cards prior to a loan will NOT have a negative impact. It will help lower your TDSR.
(your TDSR is your total debt/service ratio. This is a calculation made by taking into account your income vs your current debt. The rule of thumb for a loan is you can't pay out more than 40% of your income to the debt that appears on your credit report. You need to leave room for living expenses, rent (if you don't have a mortgage), heat, hydro, phone, insurances (auto-home), groceries etc.
A TDSR close to 40% requires a co-signer or your shit out of luck.
cancelling cards helps. lowers your risk and is the smart thing to do.
carrying a balance on your many credit cards is the quickest route to financial ruin. If you've already gotten that far, get help sorting out your finances and stick to a plan to get out of the hole.
Most banks (if not all) will not allow you to use credit as a deposit on a mortgage. The same way you can't pay off a credit card by using another credit card. (there are ways around that for people who use cash advances or debt transfer promos on new cards, but for example, if you have a store credit card, you can't make a payment at that store using your visa).Mia.Colpa said:I've have many credit cards with large credit limits. I could buy a house now.
I knew a guy that used the CC credit as downpayment on houses and pay for renovations and then flipped the house and made lots of money. It was fast, no hassle and the CC companies were happy since he always paid on time and his credit rating was tops.
Nope!
I had to call each company and have them formally kill my card and as expected the company that bought the Eatons debt, (NRI?) and Texaco were the hardest because they are into selling credit.
So once again... do a check and see what the world believes you have as potential debt and kill it.
I learned from experience Keebler that inactive credit cards do in fact remain part of your credit world. I was getting my mortgage put onto a line of credit and there were delays. Finally my Bank agent said "you have a bunch of credit cards... Petro Canada, Sears, The Bay, Eatons, Texaco with rather high credit levels even though the balance is zero." My response was "hello! EATONS? TEXACO? These companies don't even exist and I haven't used any of these other cards for 10-15 years? To which she replied, "Even though you haven't used these cards you are still on their list as a credit holder and both Texaco and Eatons were bought out by other credit card companies and so was your number and account even though the balance is zero."Keebler Elf said:
I had to call each company and have them formally kill my card and as expected the company that bought the Eatons debt, (NRI?) and Texaco were the hardest because they are into selling credit.
So once again... do a check and see what the world believes you have as potential debt and kill it.
My experience has that it's been very hard to cancel credit cards.
Even after applying in writing to cancel my TD GM Visa card, and my CIBC Visa Aerogold car (I only use my TD Visa Infiniti Travel card to collect travel points), every year I keep getting a statement from them with the yearly fee on it. Then I go through the whole exercise again.
I've canceled my deceased mother's TD Gold Visa card 7 times now.
They just won't go away.
Even after applying in writing to cancel my TD GM Visa card, and my CIBC Visa Aerogold car (I only use my TD Visa Infiniti Travel card to collect travel points), every year I keep getting a statement from them with the yearly fee on it. Then I go through the whole exercise again.
I've canceled my deceased mother's TD Gold Visa card 7 times now.
They just won't go away.
If you go to either of these sites, you can get your credit rating and find out. It will be free if you find the snail mail forms to order from, or you can get charged if you do it online.JD75 said:
They suggest you get it checked once in a while too, as they have been known to make a lot of mistakes.
Here is what I do
I use to work for a credit card company so take it for what it is worth
I have three cards & use all three for gas, clothing, food entertainment, when ever possible I make purchases with the cards.
Card A is used for purchases from the 4th day of the month to the 14th
Card B is used for purchases from the 15th to the 24th
Card C is used for purchases from the 25th to the 3th (ie roll over to the next month)
Without exception, I pay off the balance owing on each card every month
If the balance is high (big purchase such as car repair or vacation) and exceeds cash in my Bank account I use my line of credit (much lower rate) to pay down the CC balance.
I have not paid interest on a credit card balance since 1996 and have had the equivalent of an interest free loan of at least $1,000 from the three cards since 1996
How does that work you ask??
By rotating the card use I make full use of the 28 days grace period before interest is applied.
I start purchases on each card the first day of the cycle and stop using that card 10 days later.
Initially I called the credit card companies and specifically asked for the cycle to start on specific days. If they asked why, I politely indicated that is my business and pointed out I get cc applications in the mail every week.
They were most accommodating
All the points , promo stuff is a bonus, however I do not let it dictate the card of choice, it is the calender which determines the card to use.
You could extend this to 28 cards (one for each day of the month), however that is a logistical nightmare, three is manageable. There have been a couple of times where I got confused on which card to use (usually @ a bar), however over the long haul it works
I use to work for a credit card company so take it for what it is worth
I have three cards & use all three for gas, clothing, food entertainment, when ever possible I make purchases with the cards.
Card A is used for purchases from the 4th day of the month to the 14th
Card B is used for purchases from the 15th to the 24th
Card C is used for purchases from the 25th to the 3th (ie roll over to the next month)
Without exception, I pay off the balance owing on each card every month
If the balance is high (big purchase such as car repair or vacation) and exceeds cash in my Bank account I use my line of credit (much lower rate) to pay down the CC balance.
I have not paid interest on a credit card balance since 1996 and have had the equivalent of an interest free loan of at least $1,000 from the three cards since 1996
How does that work you ask??
By rotating the card use I make full use of the 28 days grace period before interest is applied.
I start purchases on each card the first day of the cycle and stop using that card 10 days later.
Initially I called the credit card companies and specifically asked for the cycle to start on specific days. If they asked why, I politely indicated that is my business and pointed out I get cc applications in the mail every week.
They were most accommodating
All the points , promo stuff is a bonus, however I do not let it dictate the card of choice, it is the calender which determines the card to use.
You could extend this to 28 cards (one for each day of the month), however that is a logistical nightmare, three is manageable. There have been a couple of times where I got confused on which card to use (usually @ a bar), however over the long haul it works
Actually, most lenders will accept you using a credit card, as long as you can prove that you have the equivalent amount of cash or liquid funds available. They only verify the availablitity of liquid funds, not the actual money source at closing.JD75 said:
What I would question is what seller would or for that matter, could, accept a cc as a down payment. Someone has to pay the CC company their retailers fee of 2-4%. If it is a resale from a private seller, it is not likely possible. If it is a new home from a builder, it is unlikely, but at the very least, the extra cost would be factored into the selling price.
Much like most car dealers will not accept a cc down payment of more than $1000.
