Depending on how bad your credit is, people need to understand that debt can cause not only major financial trouble, but it could easily damage relationships with family and friends, and your bad credit could also be a good indicator that you have an addiction to spending.
In my opinion, there's no need to have more than two credit cards, and for many, three cards should be the maximum. The issue with having a MasterCard, Visa, American Express, and every other credit card under the sun is the difficulty in tracking each credit card's spending limit, and because the statements may come in at different times during the month, you can easily lose track of the overall amount being spent on each one.
Now with access to online cards, many individuals that are maxing out their credit limits are going to an online cards site that claim they will repair or consolidate their debt with their unsecured cards. But when you look at the interest they will end up charging, you may be getting in deeper than you may be in right now!
Checking Your Credit History With Bureaus Will Indicate Where Your Finance Stands!
Once you contact your local bureau to get your credit report, you can then take a deep breath and see how good or bad your current financial situation is, and if your credit score is beyond repair, then you have to make decisions on what type of debt repair you need.
Your bank may be willing to offer you an unsecured credit card with a lower interest rate or a consolidation card, and if you're financially capable of paying down your credit limits without having to borrow money from existing cards, then you should consider these options first before taking any other actions.
If your credit problems are beyond your control, and the interest on each card is turning into an emergency situation, then your next step is to talk to your financial institution, or a debt consolidation company to apply for a consolidation loan, and either hide your cards for a long time, or better yet, cut them up for good!
Remember, it's never the end of the world even if you happen to declare personal bankruptcy. While you're taking the necessary steps to improve your rating again, and doing what's required to establish a better relationship with your creditor or creditors, you can look into other options such as prepaid credit cards to get you through your troubled times.
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Does it look bad for my credit score if I get rid of some of my credit cards?
I've recently opened several "store" credit cards (Macys, Victoria's Secret, etc.) mainly for the benefit of the store coupons and whatnot. I also have a Visa through Bank of America and a MC through Capital One. I don't really use the Visa ever and I'm not sure that I'm comfortable just having it open and never using it. Does it look worse if I close the account? Or should I just let it kind of hang there?
Thanks!
Answer
Having 2 major credit cards is good because you have a back up in case you have a problem with one of them. You should you one for gas and the other for small items. Usually a credit score changes about every 12 months of activity. My wife has a Kohl's charge card for the coupons and pays that in full every month as well as the 2 major credit cards we have. I agree that you shouldn't go crazy with credit card unless you can pay the balance the following month.
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