Author Topic: Will closing my CSP hurt my credit score?  (Read 1793 times)

dfree86

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Will closing my CSP hurt my credit score?
« on: December 23, 2016, 07:09:38 AM »
Hi All -

Could someone help me determine the answer to this question? I've quoted the situation from another thread below. Basically I'm wondering whether closing the Chase Sapphire Preferred card I've had open for two years will negatively affect my credit score.

Thanks!

If you intend to spend your money on other cards (for the bonuses) and you also have a card or two with a substantially longer credit history, is there any reason to keep the CSP card open or downgrade it? Why not just close it?

I'm worried about the effect of closing the CSP on my credit score. Hence wanting to product change it to Freedom Unlimited. Is that irrational? The fear of its effect on my score, I mean.
It can affect your score in two ways I believe. One is length of credit history. If you have another card that is older then closing the CSP card doesn't affect your length of credit history. The other is the % of total credit you're using. Any amount over a certain % (used to be 30%, maybe still is), and it's a negative. So if your total credit on all your cards added up to 50k then you could have 15k on cards before there was any decrease to your score. If you routinely put 3k a month on credit cards and your total credit from all cards is 50k, and say your CSP is 10k of that, closing it doesn't hurt you.

This is helpful. Credit History is no problem because I have another card that is almost 15 years old. the CSP is only about 2 years old.

I would say we routinely put between $2k - $4k/month on our cards because we use them to purchase just about everything. (Free points!) - and then pay them off in full each moth. We had been putting basically all of that on CSP but it will now all go on the CSR.

If we were to close CSP and open up CFU then we would probably split that $2k-$4k of expenses between CFU and CSR (for dining and travel).

So how do you think closing the CSP would affect credit score given that info? thanks!

ender

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Re: Will closing my CSP hurt my credit score?
« Reply #1 on: December 23, 2016, 07:14:32 AM »
Just do a product change to a no annual fee card.

dfree86

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Re: Will closing my CSP hurt my credit score?
« Reply #2 on: December 23, 2016, 07:17:45 AM »
Just do a product change to a no annual fee card.

Yes - the virtue in canceling it and then opening a no-fee card (like the Chase Freedom Unlimited) would be getting the nice signup bonus for the CFU.

Ocinfo

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Re: Will closing my CSP hurt my credit score?
« Reply #3 on: December 23, 2016, 07:33:17 AM »
Just do a product change to a no annual fee card.

Yes - the virtue in canceling it and then opening a no-fee card (like the Chase Freedom Unlimited) would be getting the nice signup bonus for the CFU.

Little to no harm unless you have a short credit history or carry a balance. Canceling might even up your score if it's one of your newest cards. That being said, you can also call Chase and ask them to downgrade to a Freedom or Freedom Unlimited (recently did this myself). You won't get the signup bonus but will keep same CC number without a hard credit inquiry. They'll just send you a new card a few days later.

ender

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Re: Will closing my CSP hurt my credit score?
« Reply #4 on: December 23, 2016, 07:45:10 AM »
Just do a product change to a no annual fee card.

Yes - the virtue in canceling it and then opening a no-fee card (like the Chase Freedom Unlimited) would be getting the nice signup bonus for the CFU.


The CFU signup bonus is paltry in comparison to other cards.

dfree86

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Re: Will closing my CSP hurt my credit score?
« Reply #5 on: December 23, 2016, 08:30:26 AM »
Just do a product change to a no annual fee card.

Yes - the virtue in canceling it and then opening a no-fee card (like the Chase Freedom Unlimited) would be getting the nice signup bonus for the CFU.

Yes, this is true. But If I can get it without any penalty to my score - why not, you know?

The CFU signup bonus is paltry in comparison to other cards.

ender

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Re: Will closing my CSP hurt my credit score?
« Reply #6 on: December 23, 2016, 08:34:40 AM »
Just do a product change to a no annual fee card.

Yes - the virtue in canceling it and then opening a no-fee card (like the Chase Freedom Unlimited) would be getting the nice signup bonus for the CFU.


The CFU signup bonus is paltry in comparison to other cards.

Yes, this is true. But If I can get it without any penalty to my score - why not, you know?


If your goal is to maximize signup bonuses the CFU one is pathetic.

There are many cards which give you better cash back let alone the ones that do better for travel points.

Mr. Green

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Re: Will closing my CSP hurt my credit score?
« Reply #7 on: December 23, 2016, 08:50:48 AM »
If we assume your high spending is 4k/month and let's say the credit card company reports to the bureaus mid-month before they process last month's payment, then Chase might report you as having used 6k of your credit line currently. 6k is 30% of 20k. So I would say as long as closing the CSP card doesn't bring your total credit available across all cards uner 20k, you're safe to close it. If you're chasing sign up bonuses then odds are you want to be putting all your money on those cards. I wouldn't make charges on a card that gave me no bonus while I was churning other cards unless I was in the middle of a churn where there was no bonus to be had. Then maybe the card with the best rewards would get it. If the CFU card does that for you then it could be worth hanging on to. Of course you don't have to close the account, you can just let it sit there doing nothing. It was rare that CC companies closed idle accounts before the 2008-2009 meltdown. I know they close all kinds of idle accounts then but I don't know if that practice is still in place.