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Concerns About Cancelling Oldest Credit Card

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cfong
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Concerns About Cancelling Oldest Credit Card  Reply with quote  

I'd like to cancel the first credit card I ever got, which was in college 9 years ago, because it's not a great card, it doesn't offer any perks, and it has an annual fee. With an actual credit score that's very strong, I was recently able to get a much better credit card.

I'm just worried about what everyone says about not cancelling your oldest card because it will make your credit history appear shorter. But I've read it takes 10 years for the credit history on a cancelled card to disappear, and by then, I should have built up enough of a history with the new card I now have. I'm also wondering if my student loans, which are as old as my first credit card, factor into the age of my credit history.

In short, considering my student loan history, will cancelling my first card hurt my credit score much?
Post Fri Jun 12, 2015 11:44 pm
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Wino
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Re: Concerns About Cancelling Oldest Credit Card  Reply with quote  

quote:
Originally posted by cfong
I'd like to cancel the first credit card I ever got, which was in college 9 years ago, because it's not a great card, it doesn't offer any perks, and it has an annual fee. With an actual credit score that's very strong, I was recently able to get a much better credit card.

I'm just worried about what everyone says about not cancelling your oldest card because it will make your credit history appear shorter. But I've read it takes 10 years for the credit history on a cancelled card to disappear, and by then, I should have built up enough of a history with the new card I now have. I'm also wondering if my student loans, which are as old as my first credit card, factor into the age of my credit history.

In short, considering my student loan history, will cancelling my first card hurt my credit score much?

Age of credit history is about 15% of your score. So, you can find out the answer with a bit of math. Assuming you have loans that are 9 years old as well as the card, let's say your average age goes from 6 years to 4 years. That's going to be about a 2% hit on your credit. If your credit score is 700, it will be 685 to 690 as soon as you close the card. That will make ZERO difference in loan terms, so the amount you are paying for the annual fee is what you'll save.

Short answer: Cancel all cards with annual fees.
Post Sun Jun 14, 2015 6:14 am
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littleroc02us
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My wife and I have closed all of our cc's except 1 that we use and pay off and our credit scores are near 800, so it will effect your score in the short term, but if you follow what we do then it will eventually recover. We also have 2 mortgages with low balances that we have never been late. Don't ever listen to people that say you need 5 cc's to have a credit score, just pay your cc balance off as fast as you can and never miss a payment.

Risk comes from not knowing what you're doing. (Warren Buffet)
Post Mon Jun 15, 2015 9:00 pm
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27Rocks
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If there are no major advantages then just go ahead and cancel it because it'll be on records for sufficient period till you manage to have another one and my friend life is simple when you make decisions and never look back
Post Tue Jul 07, 2015 4:18 pm
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