Should i cancel my credit cards or leave the credit active?
does it cost money to keep the credit cards active if u aren’t spending?if not then i don’t see why not,but at the same time,the banks WANT to give you the home loan,they are lookin for excuses to approve you,not turn you down. i just bought my first home a month ago,i have no loans and never had credit cards,paid cash for my cars instead of loans,so they didn’t know if i was good for repayments but they still approved me. if you earn a wage that will cover you mortgage and still give you spending money then they will probably give you the home loan. Good luck,1st home buying is SO exciting.
Although paying off your credit cards is great, it can actually lower your credit score! For optimal FICO score, your credit card balance should range from 10% to 30% of your credit limit. Find Credit Cards. If you have zero balances, there is the ‘fear’ in the industry that as soon as you have your new home, you will run out and max out your credit cards on new furnishings!
Congratulations on paying your credit card off! Having additional lines of credit open is fine. If any of these cards are actually store credit cards that can’t be used except in store, cancel them. Having store credit can hurt you. Otherwise, leave them open for now, until you get your pre-approved mortgage, as sometimes closing them can hurt you. As well, one of the more interesting aspects of credit cards is that there are service charges you can actually opt out of. Research your charges to see if this applies to you. If you are going through a mortgage broker outside of a bank, and the issue comes up that you have credit cards with zero balance, and they have an issue with that, and you have no concern with cancelling the cards, tell them, and offer to cut up the cards on the spot, since it is a non issue. That should close any concern anyone has. Best of luck and happy home hunting!
