BoA Closed My Account The Same Day I PAID!!! What does that mean for my score????

[Anonymous]

Well, I finally paid off all 13 of my cc accounts. As of 9/5 they each had a 0 balance. But BoA had sent me out some new cc's ( complete mix up...because I thought my husband didn't have one so I ordered him one and the rep offered to send us both new cards as a courtesy overnight so I accepted). Anyway, I called to make sure they were activated and when the voice prompt finished thanking me for my recent payment blah blah blah, it stated that my account was closed. Surely this must have been a mistake I thought and requested a rep who informed me that they had done a "review" of my account on 9/4 and based on my credit report showing all my revolving credit as being near or at the credit limit (totaling around $14,000 she added) they decided to close my account. I said "mighty funny how the review took place on the same day I paid it in full. But knowing there was nothing I could do as my credit report doesn't reflect my paid in fulls yet, I got off the phone utterly bitter because I paid my debts down in an effort to raise my credit scores and I know a closed account will hurt me (which is why I never intended to close any of them until I got my house). But now my question/concern is:

a. Will other cards now follow suit without warning? Can I avoid this?

b. How bad will BoA closing affect my ability to raise my credit scores over next 6 months...as this was the time frame after which I wanted to apply for a house.

c. How soon after all of this (paying off accounts, BoA clsoing account, etc.) should I check my scores to see what changes have occurred.

d. BoA told me to see about reopening in 30 or so days. Should I even bother considering I had no intention of using it beyond this point and they may require to pull my credit report again to reopen?

e. For future reference (not that this will ever happen to me again but maybe it will help someone else), Should I have paid them all off on the same day like that or little by little? Did that trigger anything with this so called "review?"

Please advise...anyone been through this?

[Candice]

Im sorry about all of this.

But, to answer your question regarding when you should check your scores...I would look into getting True Credit. They are great for credit monitoring (don't pay attention to the scores though, they are FAKOS - but this way you'll know when you should pull your FICOs)

[TangMeister]

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@Anonymous wrote:

Well, I finally paid off all 13 of my cc accounts. As of 9/5 they each had a 0 balance. But BoA had sent me out some new cc's ( complete mix up...because I thought my husband didn't have one so I ordered him one and the rep offered to send us both new cards as a courtesy overnight so I accepted). Anyway, I called to make sure they were activated and when the voice prompt finished thanking me for my recent payment blah blah blah, it stated that my account was closed. Surely this must have been a mistake I thought and requested a rep who informed me that they had done a "review" of my account on 9/4 and based on my credit report showing all my revolving credit as being near or at the credit limit (totaling around $14,000 she added) they decided to close my account. I said "mighty funny how the review took place on the same day I paid it in full. But knowing there was nothing I could do as my credit report doesn't reflect my paid in fulls yet, I got off the phone utterly bitter because I paid my debts down in an effort to raise my credit scores and I know a closed account will hurt me (which is why I never intended to close any of them until I got my house). But now my question/concern is:

a. Will other cards now follow suit without warning? Can I avoid this?

b. How bad will BoA closing affect my ability to raise my credit scores over next 6 months...as this was the time frame after which I wanted to apply for a house.

c. How soon after all of this (paying off accounts, BoA clsoing account, etc.) should I check my scores to see what changes have occurred.

d. BoA told me to see about reopening in 30 or so days. Should I even bother considering I had no intention of using it beyond this point and they may require to pull my credit report again to reopen?

e. For future reference (not that this will ever happen to me again but maybe it will help someone else), Should I have paid them all off on the same day like that or little by little? Did that trigger anything with this so called "review?"

Please advise...anyone been through this?

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Really sorry to hear this happened to you. How long did you carry that high utilization? You must understand, in their eyes, you were high risk, and the odds of you defaulting were elevated in their eyes based on your high util. So, they reduced their exposure to you as soon as they could...i.e....your pay off. That's a rotten way to do it though, but not surprising. Did anyone jack up your interest rate as well? Definitely check on that and watch out for it. There's a delayed reaction to these things, at times. You may be in for more "issues" from your other card's issuers in the coming weeks/months.

If you've paid off all of your CCs, and your utilization is zero, then a closed account is NOT going to hurt you. It only hurts if it reduces your available credit and therefore, increases utilization of a revolving debt that's reporting. So, you're fine. Might want to explain to a mortgage company why BoA closed it, though. It will show "closed by grantor" on the trade line.

To maximize your scores over the coming months, you should use the cards sparingly, and let between 1% and 9% of your total credit limit report on any given card. Keep it simple, rotate the cards, and let some balances report before paying in full. That'll help your scores. Lots of info on this board regarding this, and everything else you're asking. Great board...just do a search.

Personally, I wouldn't worry about BoA. If you had no intention of using their card, then consider it a done deal and be off with them. But if you really want to reopen the card, then call back after the first week of October. By then, your card balances should be updated and it will show your huge payoff.

Paying it all off as you did is fine. Probably doesn't matter that you paid it all off at once, to be honest, and had little, if nothing, to do with your BoA experience. They were going to zap you anyway, most likely.

By the way, your scores should go up very nicely due to paying down the utilization, since you were maxed out. As a previous person suggested...subscribe to a credit monitoring company if you want to see when your cards report, and keep track of things. Order your credit reports and FICO scores from myfico when they've all updated and see what you've accomplished. Good luck!

Message Edited by TangMeister on 09-07-2008 01:28 AM

[TangMeister]

Just to clarify on the "utilization" amount reporting to maximize your credit scores:

Anywhere from 1% to 9% of your TOTAL Credit Limits combined is what you're shooting for.

However, it's generally best to not let any one card report much more than that as a % of it's own credit limit. In other words, keep the balances low. They get nervous too, you know, if you charge too much in this day and age.

Keep the total number of credit cards reporting balances to the CBs at less than 1/2 of all your credit cards. If you have 12; no more than 5 or 6 should be reporting balances. Realistically though, I'd have 2 or 3 report and keep the balance low.

Rotate the credit cards for usage so all are used every couple months. This will not only keep your scores looking nice by default, but will also keep the CCCs from closing your credit cards due to inactivity...something that's been happening with HSBC the past few months.

Read lots more on this board. The above is just a rough draft of what you'll find here...tons and tons of good info. Good luck.

[smallfry]

Sorry to hear about this OP. At the very least I would get to BofA and ask them if they would please code this account as closed by consumer. It looks better upon a manual review down the road if you can get them to do that.

[Anonymous]

To answer your question Tang, I only had the card about a year. You can see the entire story on my first post but here's the breakdown of all the cards between my hubby and I all of which have been paid except the Home Depots:

13 CC's Between Us totaling $14867.34

Newly Opened CC's: 1 year old                      Older CC's: 3+ years old

My CapOne $5500 CL - Paid in Full                   My HD $1300 CL - Balance 614.02                 

His CapOne $500 CL - Paid in Full                    His HD $1900 CL - Balance 583.67                 

My BoAMX $1000 CL - Paid in Full/CLOSED    My AMX $500 CL - Paid in Full              

My HSBC $300 CL - Paid in Full                        His Chev $400 CL - Paid in Full              

His HSBC $1705 CL - Paid in Full                    

My Paypal MC $1500 CL - Paid in Full              

His Paypal $500 CL - Paid in Full              

My LB $200 CL - Paid in Full              

My Care Credit $2000 CL - Paid in Full              

And I'm not sure at what point I started to use the BoA but it couldn't have had a high util that long considering I've only had the card for a year, used my other high CL cc's first, and paid it off a few days ago. In any case, now that my hubby and I are financially sound again, we can stop living off the cards and actually do what we were doing a year ago before all of this moving and financial hardship took place...we would and will start back paying bills that can be paid using a cc and paying in full with the money we would have used to pay the bill in the first place each month. 

I'm not sure what I should be keeping my util at to maximize my credit score increase...I will have to do the math considering the Home Depot cc's still have a balance (will pay remaining balances when promo ends in 01/09 and 05/09) and BoA dropped my total down by $1000.

As far as the BoA closing, I'm going to take your advice and leave well enough alone and hope that it doesn't negatively affect my score in a BIG way. To be honest, the only cc's I truly plan to keep open after we reach our goal of buying a house are the Cap One, Home Dep, Lane Bryant, Chevron, and Care Credit. My reasoning is this and you can tell me what you think:

a. Home Depot for obvious reasons (will be fixing up home, 0 interst for 6-12 months for $299 or more, etc)

b. Lane Bryant because I get discounts galore for using my card and can't beat getting a $400 tab for $150...plus my credit line is only $200 and I'm a disciplined shopper anyway so no harm there.

c. Chevron because we need a card just for gas these days...it really helps to be able to budget gas like a bill each month.

d. Care Credit because there a few things that insurance won't pay for (dentist, cosmetic, etc.) and it helps that there is no interest for 12 months for $600 or more (and anything I would put on this card especially at the dentist is $600+).

e. Last but not least, Capital One for any other purchases or bills throughout the month that we normally spend cash for.

Should I do anything different...any suggestions would be great.

Message Edited by reddkaandy on 09-07-2008 01:06 PM