ldollard

What Hanco and Pulaski said.

mrken30

So you are saying it makes no difference if an individual initiated the closure or if the bank initiated the closure, the account still gets closed and affects your score?

Pulaski

Yes, your credit score assesses the facts, not the reasons.

sir_eccles

The way it is requested will be recorded on your report but I don't think it affects the score. If you request it, it will say "closed at customer request".

Accounts closed in good standing will remain on your report for 10 years.

mrken30

Looks like it may affect me in 10 years when it drops off my report. I don't know how accurate this article is , but if it's true it was quite helpful.

Closing Credit Cards - myFICO® Forums

ldollard

It matters if your bank closed the account because you where in arrears, but other than that it doesn't matter who closed the account.

What does matter is if you lower your credit spending limit, this will affect your score slightly negatively. And if you lower your limit by closing an account, while having balances on other cards, you'll affect your credit rating proportionally to the credit utilization i outlined earlier.

Additionally if you close an account of a single type for example a store card when you have no other store cards then that will also affect your score negatively. WE could literally be talking 1-2 points or 60 points. It really depends on all the other factors in your credit report.

One item affects another that affects another. Many things are taken into consideration in the vantage scoring system and then additionally for a fico score is determined on a different scoring model as well. Not everyone uses one over another.

I've noticed most credit cards use transunion whereas car dealerships will access fico.

Hanco

It is a dark and mystical thing. I was a member of an Experian group (invited by Experian) to take part in research for them on consumer knowledge and understanding etc for their marketing teams.

The discussions were revealing, mostly because it revealed we all had ideas how we thought credit scores were calculated and how companies use credit scores. Those ideas were many and varied.

What I took from it was that it is a lot about common sense and lenders do not publish how they use them or when they change their use of them because it is commercially sensitive to do so.

wolfft

I'm hoping some of you who've contributed to this post can provide some suggestions on my situation. We've been in the US for about 9 months. Through a Credit Union linked to work I was able to get a Credit Card without a problem. I've had that card for about 6 months and my credit rating on Credit Karma is shown as 699 (Fair). Within that score everything is marked OK apart from Total Accounts and History which are both marked as 'Poor' due to only having 1 credit account for just over 6 months.

I'd now like to apply for a better credit card (ie cashback, introductory offers) and also get a cell phone plan as opposed to prepay (when we tried to get a cell phone plan it's been a NO due to lack of credit history so we now have prepay phones)

With my credit rating at 699 but a poor credit history would a credit card/cell phone applications be viable? Or should I wait a bit longer rather than apply now and possibly hurt my credit rating due to credit searches. And if I should wait how much longer do I need to wait... ?

petitefrancaise

Have you been getting credit card offers through the post? That's usually a pretty good sign that you'll probably get one.
Maybe you could get a store card - Macy's and Target will usually give those out and just make sure you pay the bill. Someone else got a very low interest loan from advancial for a car as a way to build credit.

Have you got t-mobile phone plans? Their prepaid accounts are not a bad deal at all.

MidAtlantic

Credit Karma usually have recommendations of cards that you stand a decent chance of getting. Of course, they have a vested interest in what they push, but that may be worth exploring.

For Total Accounts it is not just a question of how many credit cards, but the mix of types of account. eg your score would improve if you had a credit card and car loan.

wolfft

Thanks for the tips!

Yes, my wife and I have begun to receive credit card offers in the post - but these are for cards with annual membership fees. I may try Target again. I did apply for a Target credit card shortly after we arrived but was rejected due to no credit history but may try again now the credit is on the way up.

Yes, I've got a prepaid T Mobile plan which is an OK deal but can get better deals (and a nice new IPhone!) with a proper plan

I'm hoping that as I'm receiving credit card offers that an application for phone plan and better credit card would be problem free..

wolfft

The credit cards that Credit Karma are recommending are secured credit cards which is a probably a sign that my credit rating isn't at the right trajectory yet! Good point on the mix of accounts

Pulaski

After 6-9 months with a score of 700+/- I think you're in a strong enough position to add another credit product - either a car loan, or a regular credit card from a bank. Go to one of the nearby banks and have a conversation about opening a checking account and getting a credit card. IMO you will likely be OK so long as your salary is paid directly into your checking account.

dj6372

When I bought my car on finance, my credit was 724, but a lot of finance companies said no due to my lack of credit history timewise, I had only been in the country 3 months
But I still got credit, the car companies want to sell you a car so let them do the leg work, I couldn't get the 0% I wanted but still happy with the 1.7% they gave me. I drove off the forecourt the same day with a brand new car for a 5k down!

The finance is a great way to build up credit

Hanco

Yes, around 700 you should get another credit product without much effort.

730 here and with a salary into a checking account I have the offer of a mortgage

EDIT: Almost 2 years in the country and even if you don't NEED credit for a car, I took a loan out for <b>4 days</b> and paid it off... Mortgage advisor said that being on my report probably helped too. The 4 day thing was because I had to transfer money over from the UK to US, but I really wanted the keys right then and there