How Does Closing My Citicard Card Affect My Credit Score?
CitiCard cardholders are provided with options for why they may want to close their card account including high annual fees and irresponsible credit card usage. Readers are then advised how closing the card will be viewed when it comes to calculating the overall credit score. Details are provided on credit mix, credit utilization and credit history and how they impact the credit score.
Credit cards can be a great way to pay for emergencies; however, you may be trying to move away from credit card dependency to paying upfront for things that arise. If you have a CitiCard card, you might be wondering what the impact would be if you closed the account. How does closing our CitiCard card affect your credit score? You can call CitiCard customer service here for assistance and information, and you can read below on the impact of closing your card.
Reasons You May Want to Close the Account
There are some reasons you may want to close your account even if it will impact your credit score.
High Annual Fee
If the CitiCard card carries a high annual fee with it, you may want to go ahead and cancel the card. The annual fee is just one more thing that impacts your overall credit utilization and is another bill to pay. Closing the card removes that obligation from you.
Moving from Secured Card to Traditional Card
If your CitiCard card is a secured credit card that you essentially paid to get, you may be ready to graduate to an unsecured card. This usually happens when your credit score goes up from responsible usage of the secured card.
You Can't Effectively Manage the Card
If you find you cannot responsibly manage your credit card, you may want to consider closing the account. A closed CitiCard card is one less temptation to spend.
How Closing the CitiCard Card Can Hurt Your Credit
If you are considering closing the card, there are some things you need to be aware of regarding your overall credit rating. Closing the card will impact your credit score in a number of ways.
Length of Credit History
When it comes to credit, the older the better. If your card is the oldest account you have on your credit history, closing your CitiCard card will shorten the length of your credit history. This can make your score go down.
Credit Utilization
If you close your CitiCard card, it could change the percentage of overall credit utilization to above the recommended 30%. For example, you have a $1,000 limit on your CitiCard card and a $5,000 limit on another card. On the card with the larger limit, you have used $1,800 of your overall available credit of ($6,000). If you close your CitiCard card, you will now be using 36% of your overall available credit,which is over the 30% recommended usage.
Credit Mix
Your credit history should also show a healthy mix of different types of credit, such as revolving credit lines or installment credit accounts. Closing your CitiCard card removes that revolving credit from your overall credit mix.
Before closing your CitiCard card, consider how it can impact your overall credit score before making that jump. For more information, contact CitiCard card customer service here.
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