Pep up your card without depressing credit
By Gregory Taggart • Bankrate.com

That great credit history on your old credit cards is valuable. So if you're tempted to trade in an old clunker for a faster, sleeker card from the same issuer -- one with more bells and whistles, higher rewards and lower rates -- pause, take a deep breath and consider your options.

The length of the history on that old card adds some oomph to your credit score.

"Your FICO scores are based on your full credit history, including the length of that history," says Craig Watts, public affairs manager at Fair Isaac. "Each account in your credit report is assessed on that basis."

Yes, if you close the old card, the history for that card will remain on your credit report, but only for 10 years if the history is positive (seven years if it's negative). But why give up that history if you don't have to? According to Watts, it's been his experience that when a cardholder loses a credit card and his card issuer sets up a new account, the card issuer and the credit bureau will do everything they can to make sure the history on those two accounts is bridged.

"It's possible that a card issuer or bank will do the same thing if you want to exchange one card for another. Of course, it will depend on what their customer relations policies are," he says.

Bridge carefully
It will also depend on how careful you are. In other words, it may take some hand-holding on your part to make sure the credit history gap gets bridged just the way you want.

"But if they can do it for a lost or stolen card, clearly the potential is there for them to do it in other circumstances," says Watts.

According to Roslyn Whitehurst, a spokeswoman for Experian, that's exactly how they'll report the transaction at their end -- if it's reported that way by your institution.

"If your bank or credit card company approves the upgrade to a new card and then reports it as a replacement, lost or stolen card, the account would maintain the same payment history and status," she says.

And that's what they do at Zions Bancorporation in the mountain west, says Cindy Smith, senior vice president of bank card operations. Though she's quick to point out that not all banks do what Zions does, Smith says that so long as they process the change as an upgrade rather than as a new card, there should be no problem.

"If you just want to upgrade from a Classic to a Platinum or from a Platinum card to a Signature card and the credit limit is going to stay the same, we would treat that as a transfer, so that at the credit bureau it shows up as a lost, stolen or replacement card," she says.

The same goes for the Discover Card. They'll allow you to convert from a Discover More card to a Discover Miles card without doing damage to your history. However, there might be one hitch, says Mark Scarborough, vice president of acquisitions at Discover Financial Services.

"You might have to cash out your cash-back balance with your More card since you're switching to miles," Scarborough says.

Asking for a credit limit increase, particularly a large increase, at the same time you're asking for the upgrade could complicate things as well, Smith says. In that case, your bank may need to re-underwrite your application, which means a new account and a new credit inquiry at the credit bureau. The good news is that "it will show on our credit report as the account being closed by you, not the bank," she says.

Options when bridge isn't built
You have other options if your credit card issuer is one that can't or won't do the bridge. You can stay put, or you can take the old card out of your wallet and begin using the new card instead. That way, the stellar history on the old card will continue to show up on your credit report.

"However, you would probably want to use the old card occasionally -- say for a quarterly subscription or something you can easily keep track of. That way, the old account will continue to look current and will show on your report that you continue to make timely payments," says Steve Katz, spokesman for TransUnion's TrueCredit.com.

Whatever you decide to do, if your credit history is good, be careful with it. Don't trade it in willy-nilly for more bells and louder whistles. Talk to your credit card issuer first to insure that you get a bridge to go along with all of that noise.