Draconius

One of the biggest misnomers in the credit world. I was told through a very high up person at MasterCard that it is not the truth...unless you are cancelling your credit cards that provide your credit history (eg, my Chase card I have had for 16 years, and my Citibank card I have had for 1 year). Cancelling the Citibank card will not have an impact. You available credit doesn't really factor into your score and history.

white_n_slow

Cancelling an old card should give you a small temporary hit to your score (mainly because it will reduce your overall credit limit), but should have no long term impact. Even if an account is closed, as long as it was closed in good standing, will still remain on your report and factor as a positive towards your total score.

:edit: To Brian ^ your available credit does factor into the score, insomuch as it is one of the determining factors of your debt ratios. Someone who has $10k available to them and only uses $2k on a regular basis will have a higher score (all other factors being the same) as someone with $5k available credit using $2k on a regular basis.

NOPD

pay it off like everyone said. Smart thing to do because 15% is fucking high.

94civicEX

You sort of contradicted yourself here. It's not a misnomer if it's a card with a long history as you stated.

I could go on and on about credit score, but here are my thoughts. If your loan is with a bank, see if you can get a better rate on the current loan by securing it with a CD. What you would do is make a CD deposit in excess of the term and amount of your current loan. You will usually pay 3-5% over the CD APY, but this will be cheaper than your current loan and allow you to continue establishing credit. You may have to pay off the current loan, then get a new loan against the CD. Be sure to make certain that these types of payments are reported to the credit bureaus.

Since you mentioned you have a secured card, you would be unable to obtain revolving credit, so a lot of the opinions listed are moot.

Explore the CD option and let me know how that works out for you. You options are limited if your credit is shot. A secured card and high interest loans are the few ways to get back on track.

Zackk

I have very limited (albeit good) credit. Every time my available credit increases, my score increases. Don't cancel cards if you can help it.

jaymar88

spanks. pay it off and establish a revolving credit line for your monthly expenses. Real talk.

<--- just got 1.9% APR for up to 72 mos fico 800+.

Even a gas card will be sufficient. Keep DTI reasonable and you should be good in a few.

94civicEX

Since he has a secured card, I think a revolving line is off the table for now.

spanky

Thanks, Chank. I'll go into the bank Monday to inquire about that.

spanky

Unfortunately correct.

DakarM

To show long term credit history you'll need to keep up payments on a loan for 18months. I was told by my friend who fixes credit that it's the 13th payment that takes your credit into long term good standing status but 18 is what i usually use. But given your situation, I would pay off the loan asap and when your can get a decent percentage, take out a small loan and keep it for 13-18months.