Closing Card with balance? Good or Bad

edited 8 March 2022 at 1:55PM in Debt-free wannabe
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AlexHaden2010AlexHaden2010 Forumite
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edited 8 March 2022 at 1:55PM in Debt-free wannabe
Hopefully a simple one .

credit card with a balance, paying it off monthly with quite a substantial amount. That being said, it’s going to take me about 12/18 months.

credit card company keeps upping the interest, on top of the base rate rises, so was thinking of closing it while just continuing to pay it off.

will that hurt my credit score? I hear different views, yes as available credit is lower vs outstanding credit, to no, don’t worry about it.

getting fed up with being squeezed left right n centre. 

Ta for any thoughts…

Replies


  • It doesn't matter if it changes your credit score. Your score is just a gimmick and not a factor in lending.

    If you are struggling to clear the card, there is no point in allowing APR increases. Opt out and have the card removed while you clear the balance.

  • EssexHebrideanEssexHebridean Forumite
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    I assume you've already explored possibilities for using a balance transfer card to switch it across to either 0% or at least a lower rate if 0% isn't a possibility? 
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  • AlexHaden2010AlexHaden2010 Forumite
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    It doesn't matter if it changes your credit score. Your score is just a gimmick and not a factor in lending.

    If you are struggling to clear the card, there is no point in allowing APR increases. Opt out and have the card removed while you clear the balance.

    Not struggling, just annoyed that after being a customer for 15 years, and never being late, or missing a payment, they increase the interest rate on top of the base rate.  

    “Based on risk” 15 years of a perfect record? That’s a risk?  Just want to vote with my feet.
  • AlexHaden2010AlexHaden2010 Forumite
    30 Posts
    Part of the Furniture 10 Posts Combo Breaker
    Forumite
    I assume you've already explored possibilities for using a balance transfer card to switch it across to either 0% or at least a lower rate if 0% isn't a possibility? 
    Not really, too much credit - don’t want anymore

  • It doesn't matter if it changes your credit score. Your score is just a gimmick and not a factor in lending.

    If you are struggling to clear the card, there is no point in allowing APR increases. Opt out and have the card removed while you clear the balance.


    “Based on risk” 15 years of a perfect record? That’s a risk?  
    If you're revolving a balance, yes.

    Remember that your risk is based on people like you, not you as an individual.

    If you want to vote with your feet, just pay it off and close the account.
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