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How do I switch credit cards and not affect my credit score?*

I want to get a frequent flyer credit card but I already have 3 credit cards with generous limits. I don't need these credit cards and I would like to cancel them and have this "possible credit" to go towards the new card. I heard once that canceling a credit card has a negitive effect on your credit score. Is this true? If so, how do I switch credit cards and avoid affecting my credit score in a bad way?

Answers:

1) it will ALWAYS affect your score. trust me.

2) Unfortunately, there is really no way to avoid messing with your credit score. There are so many factors that are looked at when it comes to your credit score( i.e. your credit to debt ratio; your salary and your current credit habits, etc.) there is no "cookie cutter", "one size fits all" way of doing this. If I were you, I would look to see if you REALLY need the other card. Remember, though, if you cancel another card, that could give you a shorter credit history and make you look like you are just starting out. Check with your current card and see if they have not adopted some new points system themselves. This way you will be staying in the same company and POSSIBLY have less of an affect on your credit score. The only thing to fix a credit score is an awesome on time payment history and time. If you are not going to be making any purchases that will need the assistance of your credit score in the next 6 months to a year, (i.e., buying a house or a car, etc) and this new card is absolutely a much better deal then the card you currently have then I would say to take the risk, but only if it will benefit you in more then just an accumulation of points.

3) No matter what you do it will be reflected on your score. Here is a couple of tips. Never cancel your oldest card, use it once or twice a year and pay it off. Sometimes cancelling unused cards can help your score. If you have several cards with high limits it can lower your score. Any inquiry for a new credit line will lower your score, but usually temporarily. If you are planning on making a major purchase I would leave things alone until that is over. If not, then getting a new card and cancelling an unused card or 2 will only temporarily affect your score. I personally use equifax, it is worth the annual fee to keep up on what is going on with my credit. They have a lot of information about how to improve your score.

4) Yes, it is true. Having active credit cards on your record is no problem. It shows that card issuers are willing to extend credit. If these cards have no balance on them, you should have no trouble getting a new card. Apply and start using it. if you are looking for the free credit score and report usa national site, check out this site http://free-credit-report-national.com/ Here you can see your 3-in-1 Report from all three credit reporting agencies and your credit score.

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