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Closing a credit card account can have an impact on your credit score, depending on the specific circumstances. The main way that closing a credit card account can affect your credit score is by altering your credit utilization ratio, which is the amount of credit you are using compared to the amount of credit you have available. A high credit utilization ratio can lower your credit score, so if you close a credit card account and it significantly increases your credit utilization ratio, it could negatively impact your credit score.
Additionally, having a long credit history can positively impact your credit score, so if you close a credit card account that you’ve had for a long time, it could shorten your credit history and therefore have a negative impact on your credit score.
If you’re considering closing a credit card account, it’s important to weigh the potential impact on your credit score before you do so. To minimize the negative impact on your credit score, you may want to consider keeping the account open and using it occasionally, to maintain a longer credit history and keep your credit utilization ratio low.
It’s also important to consider the effect of closing a credit card account on your credit utilization rate, and consider how it will affect your credit score.
