Does it affect your credit score to close an account while still owing money on it?

CaliGirl: Does it affect your credit score to close an account while still owing money on it?
I joined a DMP (debt management program) they are a great team and i am making a difference in lowering my debt little by little. However, i noticed on my credit report a couple days ago that many of those accounts that i have on the DMP are still “open”. I called and they advised me not to close them as this would affect my credit score- “having a credit card closed while still owing money”. But i figure if i am still making my payments on time does it really matter? Also, i thought it would help closing the account since my “open account” number would fall. Any advice??? Thank you!

Answers and Views:

Answer by mscarriem
The reason you want to leave the accounts open is your credit score is based 35% on vredit avaialable. If you close the account with a balance you now owe money on a credit account you can not use at all. They are correct in advising you to leave the accounts open. Once they are paid in full you could close them, BUT now you would have credit available which as I stated will elevate your score.

Answer by david_adl
Agree with user #1. It is noteworthy to mention that closing the account is bad for FICO, and even worse for Vantage – 40% of score.