What matters is your credit history. Unless there's a temptation to run up a balance on it again, I'd just keep it open but unused. Older accounts are generally seen a positive by lenders, and having an available but unused credit limit shows you can be trusted with large credit limits.
Your credit needs may change over time. Keeping an unused card open allows you to access credit quickly without applying to get a new card. It also helps you avoid a hard inquiry, which can temporarily lower your credit score.
From a credit score perspective, unless it is a card that you acquired very recently it is better to keep it open. This has two positive effects on your score; it keeps your credit utilization lower and it increases your average age of credit. The second is the ``unless'' part.
It is not necessary to use all of your credit cards, and failing to use one or more of them will not harm your credit. However, it is critical to keep your credit card accounts active by using them infrequently and paying the balance in full and on time.
The other risk of leaving a card inactive is the issuer might decide to close the account. If you haven't used a card for a long period, it generally will not hurt your credit score. However, if a lender notices your inactivity and decides to close the account, it can cause your score to slip.
The recovery time can also depend on the event. It may take a few months to recover from a hard inquiry, a few months (or years) to recover from a 30-day late payment, and much longer to recover from a 90-day late payment or other major negative mark (such as a foreclosure).
Do unused credit cards hurt your score? You may be wondering if it hurts your credit score to not use a credit card. Generally speaking, it does not.
There's no such thing as “too long” to keep a credit card. If you're happy with your card and getting a lot of value out of the rewards, there's no harm in sticking with it. Likewise, if you've stopped using a card and it doesn't charge an annual fee, in most cases it's preferable to keep the account open.
Reasons why your credit score could have dropped include a missing or late payment, a recent application for new credit, running up a large credit card balance or closing a credit card.
Generally, a zero balance can help your credit score if you're consistently using your credit card and paying off the statement balance, at least, in full every month. Lenders see somebody who is using their credit cards responsibly, which means actually charging things to it and then paying for those purchases.
There are some differences around how the various data elements on a credit report factor into the score calculations. Although credit scoring models vary, generally, credit scores from 660 to 724 are considered good; 725 to 759 are considered very good; and 760 and up are considered excellent.
It's generally recommended that you have two to three credit card accounts at a time, in addition to other types of credit. Remember that your total available credit and your debt to credit ratio can impact your credit scores. If you have more than three credit cards, it may be hard to keep track of monthly payments.
If you don't use a credit card for a year or more, the issuer may decide to close the account. In fact, inactivity is one of the most common reasons for account cancellations. When your account is idle, the card issuer makes no money from transaction fees paid by merchants or from interest if you carry a balance.
Closing a credit card with a zero balance may increase your credit utilization ratio and potentially drop your credit score. In certain scenarios, it may make sense to keep open a credit card with no balance. Other times, it may be better to close the credit card for your financial well-being.
You don't use the card and it has a low credit limit
Find out if it has a small credit limit and, if so, you may see little or no effect. But if it has a large credit limit, closing that card could have a big effect on your score because you're lowering your total available credit.
In general, keep unused credit cards open so you benefit from longer average credit history and lower credit utilization. Consider putting one small regular purchase on the card and paying it off automatically to keep the card active. At Experian, one of our priorities is consumer credit and finance education.
People often leave their credit cards unused, increasing the chances of the card being deactivated. Even if you don't use a credit card, the card issuer may still continue to levy annual fees and charges. An inactive credit card could be deactivated by the card issuer.
To keep a credit card active, you may want to consider using it – responsibly – every few months, if only for small purchases. You might also consider putting a small recurring charge on the card to keep it active, or making it your primary card for a frequent purchase -- say, for gasoline purchases.
If you don't use your credit card, your card issuer can close or reduce your credit limit. Both actions have the potential to lower your credit score. At Experian, one of our priorities is consumer credit and finance education.
A 700 credit score is considered a good score on the most common credit score range, which runs from 300 to 850. How does your score compare with others? You're within the good credit score range, which runs from 690 to 719.
Using more of your credit card balance than usual — even if you pay on time — can reduce your score until a new, lower balance is reported the following month. Closed accounts and lower credit limits can also result in lower scores even if your payment behavior has not changed.
The time it takes to raise your credit score from 500 to 700 can vary widely depending on your individual financial situation. On average, it may take anywhere from 12 to 24 months of responsible credit management, including timely payments and reducing debt, to see a significant improvement in your credit score.
A FICO® Score of 650 places you within a population of consumers whose credit may be seen as Fair. Your 650 FICO® Score is lower than the average U.S. credit score. Statistically speaking, 28% of consumers with credit scores in the Fair range are likely to become seriously delinquent in the future.
If you missed a payment because of extenuating circumstances and you've brought account current, you could try to contact the creditor or send a goodwill letter and ask them to remove the late payment.