Comments on: Credit Card Issuers are Closing Unused Accounts

By: Victoria

Victoria — Wed, 15 Jul 2009 19:32:03 +0000

I just recently learned that Chase had closed one of my credit card accounts. They kept telling me that is was because of something on my credit report. So I pulled my credit report and it was a good standing with everything. This was an account that I used and paid off when I did or at the very least paid more than the minimum and paid on time. What I’m finding frustrating is the amount of money that is being handed to these banks and for why? They are pulling all of the credit so why do they need these bailouts? Enough is Enough!!!!!

By: Tonja

Tonja — Tue, 26 May 2009 16:04:01 +0000

Right before WaMu switched to Chase, I had a credit card with them at a $30,000 credit limit. It was closed due to inactivity without notice by WaMu. I called to asked if I could discuss about keeping it open. They stated it was closed and could not be reopened. Two reasons this was unfortunate was I was about to purschased a much anticipated family vacation on that credit card. The other reason, my credit score dropped 20 points!!!! Luckily I still have exceptional credit, but 20 points helps. A notice would have been nice since I was just about to book my vacation. And yes, we did not go on that vacation.

By: maria

maria — Mon, 25 May 2009 16:37:29 +0000

The same thing happen to me I paided of my last credit card balance and in 3 weeks Chase closed my account for not having a balance in over 2 years and B.O.A cut my credit in half. These credit card companies are heartless I have been a customer with Chase for 18 years and they didn’t even put a phone number on the letter they sent me, I felt like you are no use to us now so get lost.I worked hard to get out of credit card debt and instead of being praised now you have to worry about your credit score with all these banks screwing you over.

By: Aarkay

Aarkay — Tue, 31 Mar 2009 17:48:59 +0000

My credit line with Bank of America was 35000K and I was using the card very rarely (once in 3 months). I always used to pay online in full just before the billing date. Effectively no balance in my a/c for the last two years. They just reduced my credit line to 15000K. No explanations were given. Hope this will not affect my credit score or report. Felt let down by the system for no fault of mine. This is happening in the greatest democracy of the world. May be democracy is applicable only to select few. How banks Banks can judge you without a trial or atleast intimate in advance that they are going to shoot you. My credit score in excellant and I know BOA got a system of regularly checking my credit report. There is no negative item in my credit file. Is the banking system is in the grip of panic? I felt help less and attacked!!

By: Mary

Mary — Mon, 26 Jan 2009 22:01:19 +0000

Similar, but different: I just had a credit line of $8,000 shut down by WAMU on a card I was using but had small balance. Had nearly paid off as they had just sent me a letter to one of their most valuable customers with checks offering new borrowing at a lower rate. I have a very good credit score, have had the card for years, have perfect payment history including always on time and over the max every time and sometimes paying entire balance, then using again. I had intended to use one of the checks for cash in my bank account to help see me through my business launch. Just logged in one day and found overnight they had closed the account and my available credit went from $8,000 to 0.

I called their customer service to ask about this and was told they have no authority to do anything and cannot open a closed account ‘the system’ has closed.

It will greatly impact my credit score removing the $8,000 available credit from my overall usage as I have been getting ready to start a new business using some credit along with available funds and a couple of smaller cards have higher usage. Was saving this and another with a bit more usage but a fair amount available.

As this could well happen with other consumers with good credit scores and perfect record, do you have any comments?

Thanks

By: Brandon

Brandon — Thu, 08 Jan 2009 03:50:07 +0000

Household Credit is now doing this……but they dang sure extended the offer to me to call in and get a new card, I am sure with worse penalty fee’s and higher interest rates!!! I wont go back but I am more worried about the effect it will have on my credit rating.

By: Tim

Tim — Wed, 03 Dec 2008 00:14:09 +0000

correct, but credit score doesn’t matter unless you are trying to get a loan and utilization is a minor element of your score and really has a minor affect on insurance premiums unless the score is seriously tanked, which won’t happen unless you default on the credit. but it is a good point to note.

@pennyseeds: the reduction of score is minor and will vary depending on how long you’ve had the acct. i would use the card to keep it open if it is a long standing card. if it is not a long standing card, then it doesn’t matter if it closes out. your credit age won’t be impacted much by a 2 year old account that gets closed. and even then, it will recover quickly. moreover, if you aren’t getting a loan, it doesn’t matter.

By: Eric

Eric — Tue, 02 Dec 2008 21:10:22 +0000

I’ve had the same experience with Discover. Citi did something different-they moved part of an unused card available balance to another card and THEN closed the unused card.

By: PennySeeds.com

PennySeeds.com — Tue, 02 Dec 2008 17:57:22 +0000

This could effect me negatively since I have a few cards I do not use.. It would be nice if FICO was intelligent enough to report that these were accounts closed due to inactivity.

Meaning that a score drop had nothing to do with your ability to pay, ect. However, that would be too much to ask I guess.

By: admin

admin — Tue, 02 Dec 2008 00:16:05 +0000

Right. I don’t really see it as a problem, either. It’s just something for cardholders to be aware of, especially with regard to the possible credit score effects. If you really want those accounts to stay open, you should use them every once in awhile.