I need some advice. I just opened a third credit card and I have one that I haven't used in two years. I'd like to close it. Will closing it affect my credit?

Short answer: yes.

Longer answer: it depends on your age, the age of the other card, the age of this card and your overall file contents. In general a perfect file has a mortgage, a car loan, a non-auto/non-RE installment loan and roughly one revolving line (general purpose or retail) for (age-24)/2.

You really don't want to close something that would make your oldest open account younger than seven years, as oldest open line is a huge score factor.

Closing it hits your score in three ways: loss of a trade line, reduction in Average Age of Open Account and by artificially increasing your revolving utilization.

A file with cards with $6k line, $4k line and $14k lines, assuming you spend $4k/month on the 14k card and pay it off every month, is positive to score by about 20 points. If you remove the $4k card from the equation, that drops to about seven points because your revolving utilization goes from 15.3% to 20% which moves you to a slightly less desirable utilization category.

@SC1 yea it is the oldest. Ok that makes sense. Thanks!!

Also consider: What do you need your credit score for right now? This is a hit, if any, that will go away in a 1-2 year period as your remaining accounts age. Unless you want to buy a house, you probably don't need a great score. And unless you're at a marginal score, it probably won't even matter for an auto loan.

God credit scores suck. I'm finding this thread super interesting yet also infuriating. Like, why the hell should closing a credit card you don't use affect future purchases down the road? Seems like an arcane and arbitrary system.

So the credit line on the card I want to close is pretty low. I opened it when I was 18-19 to start building up credit. I'm 25 now and just don't have a use for it anymore.

Is it the oldest card in the stack?

I've had pretty good luck leaning on those issuers to say "hey, I've got better stuff in my wallet - what can we do to this card to make me more likely to use it" - I took one Cap1 card from a 1400 line to a grown up card just by putting some recurring charges on it and hitting the CL increase request button every six months like clockwork.

S& - the models show that being able to keep a single issuer happy with you over a very long time is positively correlated with not stiffing the next new creditor in the first two years after opening the account.

Oldest open line may get less weight in FICO 9, but mortgage lenders are still using FICO 5.