Say goodbye to inactive credit cards

Posted by Caitlin on October 6th, 2008

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Credit card companies aren’t just lowering credit limits in response to the economic downturn. They are also more likely to cancel inactive cards. This can lower your credit score by decreasing your amount of available credit, but also by shortening your credit history. If you have one or more credit cards that haven’t been used for a while but are still open, consider whether or not you need to hang on to them before the credit card company makes the decision for you. If the unused card has a very high credit limit or is one of your oldest cards, consider using it for occasional small purchases in order to keep it active and open. Newer cards or cards with lower credit limits are less essential to your FICO score, so you may consider closing these types of unused credit cards, or allowing the credit card company to do it for you if they so choose.

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