Is your scorecard low? However, cancel the credit card this way. Do this if you have more than two credit cards. Let’s find out in detail.
That’s not a big deal. It is easy to cancel your credit card. But, deciding which card to cancel may not be so easy. In particular, care should be taken not to reduce the credit score. If the interest is high, the benefits that come with the card may not be of much use to you, converting the card that came with the fixed deposit guarantee into a regular card, and having more credit cards may cause the card to be withdrawn.
The amount of debt available to you will decrease. This will increase the debt utilization ratio on other cards. Your credit card limit is Rs. 30,000. Suppose you spend Rs 30,000 per month on all these cards combined. Then your debt utilization ratio is 25 percent. If you withdraw one of these cards then your debt utilization ratio will reach 33%. If it exceeds 30 percent, banks will assume that you are over-reliant on loans. In addition the credit score goes down when your debt consumption is high. When you have an old credit card .. its bill payment history is high. If you pay them regularly .. you will have an understanding of your loan history. Therefore, it is advisable not to cancel cards that have been in use for more than 10 years. Rupee arrears .. It will continue to appear in the card details.
Closing the account, settling .. There is a big difference between the two. Paying the full bill arrears and canceling the card can be called close. But, if you ask for some discount on the bill to be paid and bargain to pay the rest, it is called settlement. This can have a negative effect on credit score and loan history. That is why it is better to pay the card bill in full as much as possible. Also give the bank the information that you are canceling the card. Let me know in writing.
