What do you think about opening and closing credit cards for the initial sign up offers?

I know that closing lines of credit does cause your credit score to go down because you have less available credit. So, for that part of it, it will cause your credit score to drop when you close the account. I’m not sure what other effects it may have on your credit, but you may want to be sure you read the fine print about those benefits before you sign up for the card. There may be restrictions that say something about canceling the card and having to return some of the benefits or not being able to use the benefits until you’ve had the card for a year.

Will you be needing credit for anything soon? Buy a house? Second mortgage? Start a business? A car?

If not, then it seems to me it doesn’t matter. Your credit is probably already pretty stellar. Opening and closing credit cards over a period of a year probably won’t make that big a hit, especially if your payment history is good. In addition, having too many credit cards can be a bad thing. They always assume you have borrowed the max on each card. So if you get rid of a card, then your debt burden goes down. At least, that’s what they told us when we bought our house.

I don’t know what has happened to our credit rating lately, though. We paid off our house and car, and we only have one or two credit cards that we pay off every month. Maybe we need to borrow more.

@wundayatta I was told that when you have credit cards with a $0 balance, it shows you have credit available, which looks good. When you close those cards, you no longer have credit available, which actually is a hit because you had the credit available and lost it (even though it was your choice to do away with the card because you didn’t use it or whatever other reason). Creditors don’t just look at the number of cards/accounts you have, they look at your debt/credit ratio, meaning how much of your available credit you are using up. They like to see people that have very low debt/credit ratios.

@wundayatta We paid off our house and cars and have about 6 credit cards, only two are used regularly, and 2 of the barely used are just department store cards. We always pay off our credit cards every month. Basically haven’t had any debt for 3 years, except for the rolling balance on the credit cards that is there for items charged, but not yet billed.

My husband just went to lease a car and his credit was over 800, so if I were you I wouldn’t worry about it, except that it is good to check it every once in a while to make sure there is nothing on your credit that shouldn’t be there, a mistake.

I think it will impact your credit rating adversely.

From what I understand, having too many accounts open may affect your score, and also closing them (even if you’re the one doing it and you paid everything on time and there is a $0 balance).

I mentioned that I know it affects my credit in the original informtation of my question.

@JLeslie aight, you seem to have answered your own question.

What I think is that there is no way to take advantage of the advantage takers. They are not in business to distribute free money and benefits. I would not try to beat them at their own game. One way or another, the cost will be greater than the gain. That’s what I think.

We do it all the time. We have several credit cards outstanding with 0 balance. The most recent one was a similar offering from Holiday Inn that gave us four free nights for our latest vacation.

We open credit cards with the 0 interest, 0 payments for 12 months (or similar term), and transfer our interest loans to them for the free term, then cancel them. In the past we were able to buy a car and not pay for it for three years, but we are receiving fewer offers now.

The IMPORTANT RULE: put the regular payments in an interest earning savings account just as if you were paying on the loan so that you can PAY IT IN FULL just before the due date.

@Jeruba Not true. You have to be careful, but we have actually MADE MONEY from banks and credit card institutions. We commonly open bank account where they put $100 in our account, and we have other family members open accounts under the same plan. We have earned nearly $1,000 FREE MONEY over the past couple of years, and it hasn’t cost us a single cent.

@YARNLADY. I labeled my comment as my opinion fore and aft, and you can hardly say that it isn’t true that it’s what I think. If you believe that they are in business to distribute free money and benefits, then we simply disagree.

If a person is willing to spend a whole lot of time and effort thinking about money, juggling accounts, watching out for numerous and varied payment schedules, following rules, etc., I shouldn’t wonder if he or she could find away around the limits. I wouldn’t be willing to do that. That’s part of what “the cost will be greater than the gain” means to me.

No doubt someone else will be paying for your free rooms with fees charged on payments posted late (regardless of when they were sent), be unable to reach anyone on a customer service line without waiting an hour on hold, end up being asked to pay interest on the same balance for the same month by two companies when they attempt to transfer, and come away feeling soiled and misused, if not downright cheated. It’s a dirty business, and I am averse to playing the game.

The OP asked “What do you think?” and that’s what I think.

@Jeruba Oh, I’m sorry, my wording was terrible. I meant no disrespect and I just was being thoughtless.

I am kind of in the middle between @Jeruba and @YARNLADY. I have decided I am not willing to do this sort of thing with multiple deals, but one credit card every year or so probably is worth the trouble, and I agree @Jeruba it does take some effort to keep track so a person does not wind up paying when they were hoping to be gaining. But, I, like @YARNLADY have made/saved thousands over the years using my credit cards. Maybe with the whole country switching to credit cards in the end it raises all prices, I think that is probably true in the big picture, but I do not feel little ol’ me can change thay reality.

The credit cards don’t really lose when we game them, because they make money on every transaction. Giving away free nights at hotels doesn’t cost them mich, because the room already exists. The only time they lose on that is they have 100% occupancy, and actually lost a paying customer because I booked a free room.

The discussion helped me decide what I am going to do. I was already leaning towards opening the card, but have been resisting doing it, and the many other offers that come into my email and mailbox, but this onw was hard to turn down. Thank you all for your answers. So, I am going to open the Marriott credit card, and close another one I barely use. Most likely I will close the card before the annual fee, unless they wave the fee, which sometimes I have been able to accomplish.

Doing that will mess up your credit score. Is that worth the $350?

I say play the game and enjoy your life! Unless you are saving up and struggling for the next big thing (please dont be offended but if you can stay Marriot from time to time I’d say youre well off) and you should feel free to have a good time and play their game. Unless you’re saving up for a pure electric pick up truck by Ford with 10,000 horse power and will cost 70,000 I;d say you’re good to go :D

@dreamwolf I am usually staying at a Fairfield Inn or Courtyard.

@dreamwolf: Often staying at a good hotel does not cost a whole lot more than staying at a crappy hotel. Marriott is a mid-level hotel, in my opinion. You can get deals of about $100 per night, which is not much more than your crappy local dive hotel.