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Does Closing a Credit Card Account Help Your Credit?

The debate goes on. Does closing a credit card account harm or help your credit?  Here’s a good article that discusses this topic and dispels the myth that it is ALWAYS a bad idea to close a credit card account.

http://www.gobankingrates.com/credit/credit-score/biggest-credit-myth-that-just-wont-die/

The article provides three scenarios in which you should consider closing an account.  If you are paying an annual fee, but not using the card – close it.  If you have a problem with overspending – close it.  If you are debt free – close it.  Experian, one of the three major reporting bureaus, even acknowledges that you don’t lose the positive credit history immediately upon closing an account.  In fact, Experian retains closed account with no negative information for 10 years, which is much longer than the negative information that stays on your report, such as late payments, which may stay on for up to seven years.  Look at the facts and study this article if you are considering closing a credit card account.  It may or may not make sense in all instances, but you should make an educated decision when it comes to something that will have an impact your credit score.

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Kevin Fallon McCarthy is the McCarthy Law PLC’s managing attorney and an experienced Phoenix debt attorney. Mr. McCarthy has also worked as general counsel for a large corporation. He has corporate counsel experience in human resource matters, general corporate governance, and union class action litigation.