closing account with balance

I have a quick question if anyone can help. Will it negatively impact my credit report if I close an account with a balance? One of my cards is raising my apr as of March 2009. They have given the option to maintain my current rate if I close the account before that date. I am current on the account but am already struggling to make the minimum payments. Will it look terrible if I close the account with a balance?

Thanks for any help!

You can venture out for a low or zero rate balance transfer credit card and transfer all your balances from your current card to your new card. Zero rate cards are tough to get but low rate balance transfer cards are also available. Please keep in mind that the rate at which you get a low rate credit card depends on your credit score.

But beware that this low or zero rate is only an introductory one. After a certain period of time, anything between 6 months to 1 and a half year, this rate jumps back to high rate. So, be cautious while transferring your balance from a high APR card to a zero/low APR card.

You can also go through the article "Balance Transfer Credit Cards - Dos, Don'ts and Everything" in my blog, as given in my signature.

I am thinking about closing a couple credit card accounts with a balance and keep making payments. How bad would this hurt my credit score???

I lost my job so I cannot apply for a 0% intro card at this time. If I close some accounts with balance and keep making payments,.. how much will my fico go down??

Hi guest,

What was the reason they gave you for raising your APR? You should check your credit report immediately, likely it is already going down. The sooner you take care of this, the better off you will be. If you are struggling with minimum payments already, the higher interest rate will only make things worse.

Closing the accounts yourself is far better in this case rather than waiting for the downward spiral. Especially since you just lost your job, your debt to income ratio will change significantly. So it is probably already going down. But how much depends on all the information on your credit reports and so there is no real way to predict.

chrys

It will not hurt your credit alot. It is always best to just pay down the balance and keep the card open with a zero balance. As it will show good credit history. Hope this helps.