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04-23-2009 07:17 AM
04-23-2009 07:40 AM
Georgia: Ask AAA how this card will report once you *opt out*.
I opted out on one card & it still reports at the original cl. I wouldn't take that 24.99% standing up either. Can you do a b/t or take a personal loan? Are you eligible for Navy Federal CU or any CU?
I'd explore those options before making a decision.
04-23-2009 09:45 AM
There are some good news and bad news. Good news first. Since, I assume it's a BofA card (I had exactly the same situation as you), as long as you don't charge any new purchases, you will be able to pay it off at old rate. The new rate doesn't apply to existing balances retroactively. Bad news is that as soon as you pay off this card, they wil slash your credit limit.
Because it's your old card don't close it, but aim to pay all the balace as soon as your circumstances allow and PIF from that point.
04-23-2009 09:48 AM
Well, I did ask how it would affect my credit report, and the answer was somewhat vague. I think it will still be listed on my reports (like yours). I tried to talk to the customer retention department at AAA, but they wouldn't let me. So I ended up talking to customer no-service. I'm hesitant to transfer the AAA balance to another one of my cards (with a lower APR), what if that cards' interest gets increased (a chance it may be increased even higher)? As far as inquiring about a loan from a cu, I really don't want anymore credit (I have 6 cc's, mortage, car pmt.). I do know that cu's are a good bet. My husband belongs to one, but he just took out a loan (to pay off one of his high(er) interest accounts). Arrgh! All of this woe and I just lost my job. Thanks for your response.
04-23-2009 10:33 AM
04-29-2009 01:49 PM
Thanks for the useful information. I opted out in 02/08 because I didn't want the APR increase. I will make certain that I leave a small balance on the BofA card to (hopefully) avoid a CLD. I've worked hard to get my EQ FICO to 753 and I don't need an AA bringing my score down. Again, thanks for helping me to avoid financial disaster.
04-29-2009 05:47 PM
Georgia: Here's how I understand the opt out option. You agree to opt out; they freeze the card's interest at the old rate. You cannot use the card. Then, when you pay off the card they will close the account. Your FICO score may take a dive, expecially if you have had the card for over five years. Remember, 30% of your FICO score's computation is your history. Unfortunately, FICO's computers do not distinguish between the consumer closing his/her account and the lender closing the account.
To clarify, the hit for loss of AAoA will not be immediate; closed cards generally will stay on your report and count toward AAoA for ten years (generally - could go a bit early or stay a bit late).
What MIGHT give you an immediate hit to your score if the card is closed after PIF is the loss of that CL in your debt-to-available-credit ratio (util). If you've got a high overall util already and this CL is a major chunk of your available credit, then that card closing could hit your scores hard.
04-30-2009 05:51 AM
Yes, I'm aware of the debt-to-available credit disadvantage. So,would keeping a small balance on the card be smart in order to keep that CL as part of my overall available? Perhaps at some point, my interest would be reduced (to what it was originally)...what do you think? Thanks!
04-30-2009 06:57 AM
Someone mentioned it - but was this a BoA AAA card?
I just got a no-reason ratejack on my BoA ABA card (10 to 21) and am looking to buy a house soon. So the knowledge that they won't report it as closed or kill my credit limit immediately is comforting. I wasn't planning on using the card, but having 7000 subtracted out of my total credit line is scary.