# Cancelling a Credit Card?



## peterk (May 16, 2010)

I've had this $US currency Mastercard for several years now. I was pressured into getting it when I opened a $US bank account a few years ago because I was working in the states for a couple months and getting paid $US. But last year, and now this year they've started charging me a $25 annual card fee. I never use this card anymore and want to get rid of it. But I've heard there could be credit rating ramifications for doing so. Could someone explain to me the potential issues/drawbacks I may have by canceling this card?


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## HaroldCrump (Jun 10, 2009)

If you aren't using it, and don't expect to use it anytime soon, just cancel it.
You will save the yearly fee.
You are running a bigger risk by having an open, un-used credit card A/C.
Impact to your credit score (if at all) will be marginal and temporary.


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## Wealthy1Day (Aug 30, 2009)

While it is true that having a long credit history does postively impact your score, it is also affected by your _potential_ debt not just your balances.

So it's a matter of looking at the sum of all the parts.


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## travelgeek (Nov 29, 2009)

if this is not your oldest card, there will be very minimal (if any) impact on your score. I would definitely cancel it especially if you're paying a fee for it.

if it is your oldest card, just switch it over to a no fee Canadian product.


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## GeniusBoy27 (Jun 11, 2010)

Agree. The hit to your credit score is generally overrated. If you have good credit to begin with, it's really not a major worry.


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## MikeT (Feb 16, 2010)

My us credit card account doesn't even show up on my Canadian credit report from equifax. I know that Canadian companies can check your American credit report and vice versa if you ask them to (this is how I got my car financing when I moved). 

I'd say that If you aren't planning on moving back ever, then cancel it. If you want to keep the door open like I do, then keep it open (maybe switch to a no fee type), and buy one thing per month on it just to keep it active. I now have long credit histories in both countries.


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## travelgeek (Nov 29, 2009)

MikeT said:


> If you want to keep the door open like I do, then keep it open (maybe switch to a no fee type), and buy one thing per month on it just to keep it active. I now have long credit histories in both countries.


Very true. I had assumed that the OP had a USD credit card from a Canadian bank. If it is from a US bank, it will be worth keeping just to leave your options open in the future. Just switch to a no fee one.


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## peterk (May 16, 2010)

Oh yes I wasn't so clear about that. It was from a canadian bank, and wasn't by any means my first or primarily used credit card. I've just called and cancelled. Thanks for the advice everyone!


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## frugalmini (Feb 19, 2011)

peterk said:


> Oh yes I wasn't so clear about that. It was from a canadian bank, and wasn't by any means my first or primarily used credit card. I've just called and cancelled. Thanks for the advice everyone!


I read a couple of years ago, that to maximum your credit score. 

1, have up to 3 credit card of different type, no fee, with cash return;
2, use up to about 20% of the credit limit on each card;
3, pay off your balance each month.

Cancel your unused card might hurt your credit score in short run, but it's good for the long run. That's what I did two years ago.


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