Ikea is dropping its Ikea credit card in May 2011 - Close out credit card now?

[kysin2014]

Ikea is no longer accepting applications for new credit for their Ikea credit card.  I am a current Ikea credit card holder.  However, Ikea is stating that credit card customers will only be able to use their credit card until May 8, 2011.

Here is a link from an Ikea store in Houston, TX telling the truth about how they are no longer accepting applications for the IKEA credit card; and how current IKEA credit card customers will only be able to use their credit card until May 8, 2011.   Here is the link: http://www.ikeahouston.com/store-information-houston-texas

This is very concerning news.  Would I be correct in saying so that if current credit card customers who do not currently close out their IKEA credit card with GE Money will suffer having GE Money close it out on them with their IKEA credit card account showing "Account closed per subscriber" instead of just closing it out yourself and having it report "Account closed by consumer reported by subscriber" ????   Please any comments or advice is much appreciated.

[cdtotten]

There is absolutely no difference between credit cards closed by grantor and closed by consumer. It has no effect on FICO scoring, and I have not once seen it effect anyone on a manual review. If you have a positive history on the account, does not matter who closes it and any manual reviewer will see that.

[Creditaddict]

This is the second time Ikea has done away with their credit card program... I don't know what gives!

[poet]

Well, how about this: I just HAPPENED to look at the (already PIFd) account and discovered that IKEA/GEMB LOWERED my credit limit significantly before eliminating the account!!! My limit was knocked down to $140 after I PIF'd nearly that as remaining balance. It had been several hundred dollars higher, as I recall.

Does this mean that 1) my UTIL is lowered and thus my score, as well? And 2) does it mean that IKEA/GEMB's final parting gift was to knock down my CL to a fraction of what it had been? If so, how/what can I do to protect myself?

[Wolf3]

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@poet wrote:

Well, how about this: I just HAPPENED to look at the (already PIFd) account and discovered that IKEA/GEMB LOWERED my credit limit significantly before eliminating the account!!! My limit was knocked down to $140 after I PIF'd nearly that as remaining balance. It had been several hundred dollars higher, as I recall.

Does this mean that 1) my UTIL is lowered and thus my score, as well? And 2) does it mean that IKEA/GEMB's final parting gift was to knock down my CL to a fraction of what it had been? If so, how/what can I do to protect myself?

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It will not be used to calculate UTIL after it is closed and paid off.    So it will not matter.

[poet]

Wolf, the thing is, I don't know whether IKEA will later reissue another card under some other partner's branding, or is 100% out of the store-brand credit-card business. What annoys me is that my total available credit just took a pretty significant hit (I'm pretty poor), maybe 15%, and my credit score also nosedived at the same time. I assume that the IKEA card suddenly closing is why. Anyone else had a similar problem? And under these circumstances, can we get a free credit report?

[llecs]

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@poet wrote:

Wolf, the thing is, I don't know whether IKEA will later reissue another card under some other partner's branding, or is 100% out of the store-brand credit-card business. What annoys me is that my total available credit just took a pretty significant hit (I'm pretty poor), maybe 15%, and my credit score also nosedived at the same time. I assume that the IKEA card suddenly closing is why. Anyone else had a similar problem? And under these circumstances, can we get a free credit report?

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If you PIF, your score will bounce back, all else being equal. If FICO reads that card as maxed out, then it won't be once PIF. If you have a good mix of other CCs outside this card and util is low on the others, then you are good to go once it reports $0.

I think this could qualify as adverse action and I think, on that alone, you can get your 3 CRs for free.

[poet]

An update...my long-fought-for score is now *under* the basement. Thanks, GEMB/IKEA. Really appreciate the 1) false report 2) bad-faith CL lowering at the last minute 3) lack of notification about the card being dropped for all customers.

Today, I got an apologetic notice saying that "some customers"--including me--had been accidentally overlooked in terms of IKEA notifying customers of the pending GEMB split.

I find it interesting that I did not get this notice until several months after the fact--AND only after I filed a dispute with at least one of the CRAs. My dispute was along the lines of "Paid in full--Never late."

So, how shall I go about dealing with this? I'm contemplating 1-2 "get back on your feet" cards to raise my total available credit, then (as limits rise) cancelling all remaining GEMB cards. I was just on the cusp of applying for  Discover card with a lower rate and doing a balance transfer--that is, moving up to a better card with a lower limit.

P.S. Hi llecs. I was never late. And it was PIF to begin with. That's the insane part.

[Anonymous]

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@poet wrote:

An update...my long-fought-for score is now *under* the basement. Thanks, GEMB/IKEA. Really appreciate the 1) false report 2) bad-faith CL lowering at the last minute 3) lack of notification about the card being dropped for all customers.

P.S. Hi llecs. I was never late. And it was PIF to begin with. That's the insane part. 

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Hi poet!

My apologies, in advance, if I'm misunderstanding something, but are you saying that GEMB has now reported (false) lates on your credit reports?

[poet]

Hi, LilMirth--yes, I am saying that. I was never late. They claim I was late on the final payment, which was PIF, and which was fairly small (about $140). They closed out my account, saying my CL was that $140-ish amount (it was more like $600, as I recall) and said it was a 30-day late pay. And they (neither IKEA nor GEMB) never notified me in advance that teh two companies were parting ways and that all IKEA cards would be closed. I got an apologetic letter and a copy of the notice this week (3-4 months later). By then, the damage was done. I disputed it with at least one credit bureau.