This may happen without notice and can hurt your credit, so you should take action prior to automatic account closure, which we explain below. Card issuers typically close accounts that aren't used within a certain time period, usually over a year. While not using your card can help your utilization, it may impact your account status. If you don't activate a credit card and thus don't use the card, your account may be closed. The Blaze Mastercard is issued by South Dakota-based First Savings Bank, a smaller card issuer that isn’t included in J.D. But say you open a new card with a $6,000 credit limit and never use it, your total utilization would drop to 30% - which experts consider ideal, though 10% is even better. A new card provides a new credit limit and if you never use your card, the added credit limit can help lower your credit utilization rate.įor example, if you currently have one card with a $3,000 balance and $4,000 credit limit, your utilization is high at 75%. You should also consider how opening a new card affects your credit utilization rate, which is the ratio of your total debt to total available credit. Missing the annual fee payment can hurt your credit score since payment history is the most important factor in calculating your score. If you skip card activation and don't use your card, you're still responsible to pay for the annual fee. The fee shows up on your balance in most cases, and if you forget about it, the fee can easily become a missed payment. Card issuers often charge annual fees on your first bill and every year on the anniversary of your account opening.
For starters, you should be aware if your card charges an annual fee. Whether you activate your card or not has no direct affect on your credit.īut if you don't activate your card, there are still a few things to keep in mind.
This can ding your credit score roughly five points, though it will bounce back soon. When you apply for a credit card, an inquiry typically appears on your credit report.
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