papabt2 Posted March 29, 2011 Report Share Posted March 29, 2011 I am new to the forum so forgive me if any of this is redundant.I am hoping to buy a house in the 12 months. My credit score is somewhere between 700 and 735. I have three open credit cards, each with a 2k limit (all at a zero balance). 28k in student loans. One of my credit cards has installed a $55 dollar annual fee, new this year. I would like to tell them to shove it where the sun don’t shine and cancel the card. I know this will have an effect on my credit score, seeing as is will remove the good payment track record and decrease my available credit by 2k. Is it worth it to just pay the $55 or should I cancel the card? If I do cancel the card, do I open another credit account to make up for the lost available credit? Any information is welcomed. I thank you for your responses in advance. Link to comment Share on other sites More sharing options...
jq26 Posted March 29, 2011 Report Share Posted March 29, 2011 I'd call them and tell them to waive the annual fee or you'll cancel the card. With credit like yours, you shouldn't be paying them. If they baulk, DO NOT CANCEL it quite yet. The very best rates are for folks with middle FICOs of 740, similar but slightly highe rates are for +720. Even if your score drops 10 points by closing the card, you'd save $55 but could end up costing you that much every month for the next 10+ years ($6600). Even 1/8% differences in mortgage APR become huge sums of money over the long run due to the large amount involved in a typical mortgage debt. Once you are in the home, then tell the lender to pound sand and cancel the card with the annual fee. Link to comment Share on other sites More sharing options...
McLovin Posted March 29, 2011 Report Share Posted March 29, 2011 jq26 beat me to it!I don't think a brand new account (credit card) will have as much influence as an older, established account with good history. The lenders want to see credit history. If it were me, I would eat it and pay the 55$. If you are still dissatisfied with the CC company, cancel them after your house closes escrow and get a replacement from a new financial institution.Also, try to maintain something more than a zero balance on your cards. They want to see you utilizing your available credit as well, not just sitting on it.How about your student loans? Are you current on them? How long have you had them? Got any late payments showing up on your CR? If so, you may want to try writing them a goodwill letter and pleading with them to remove them. My advice, don't copy and paste the letter in the link. Use it as a guide, but write it yourself in your own words. Make it personal, and do dome homework and be sure that you address it to somebody important, not some office lackey. Link to comment Share on other sites More sharing options...
johnwhite Posted April 6, 2011 Report Share Posted April 6, 2011 Older credit card (the longer you have it) will have greater impact. Keep it if you can. Link to comment Share on other sites More sharing options...
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