topic Re: Secured Card with a Balance? in Credit Cards

Secured Card with a Balance?

Anonymous — Tue, 13 Sep 2016 00:53:43 GMT

Has anyone ever closed a secured card with a balance? How does something like that get reported on your credit report?

Re: Secured Card with a Balance?

pizza1 — Tue, 13 Sep 2016 02:43:17 GMT

I would assume like any other card reporting. Once your balance is paid off, then your "secured" portion will be returned to you.

it will report closed with a balance. Just so you know, FICO will not consider this card into overall "utilziation" once its closed. YOu might consider that before you close it.

is there anyway to pif before you close it? Who is it with?

Re: Secured Card with a Balance?

pizza1 — Tue, 13 Sep 2016 02:41:28 GMT

Re: Secured Card with a Balance?

Anonymous — Tue, 13 Sep 2016 03:21:19 GMT

I am currently unable to pif. So will it reporting as closed with a balance bring my score down? It is with Capital One.

Re: Secured Card with a Balance?

pizza1 — Tue, 13 Sep 2016 03:44:39 GMT

@Anonymous wrote:
I am currently unable to pif. So will it reporting as closed with a balance bring my score down? It is with Capital One.

If you dont mind me asking.....whats your balance/CL, and are they closing it or are you?

As stated, closed with a balance will continue to effect your score some.

For example, lets say you have the following...( bal/CL)

CC#1....$300/500

CC#2...$150/300

CC#3...$250/300

With the above senerio, assumming they are open, you'd be at $700/1100 = 64% util (this is what FICO see's)

Now...lets say you close CC#1 with the same balance....$700/600 = 116% util....(fico will see your total balances, but will not add in your closed CC CL.

Does this make sense at all? LOL...Im trying to explain the best I can. Do you have any other CC's you could get a CLI on, to make for what youll losing when it reports closed with a balance?

Without having to reveal too much personal info, it would help to know whats going on some, so we may assist further, and others can come on and give advice as well...

Re: Secured Card with a Balance?

NRB525 — Tue, 13 Sep 2016 04:17:00 GMT

Good try Pizza

The only reason to initiate a Closed by Cardholder of a card with a balance is to freeze the terms if the lender is trying to change terms. OP, has Capital One proposed changing the terms such as APR on this card? What is the limit?

You are free to close it, with a balance or without, but you still need to pay it off if there is a balance. It won't have much impact at all on your credit report, so if you are looking to "hide" the balance by putting it on a closed card, no, not going to disappear from your credit report

Re: Secured Card with a Balance?

pizza1 — Tue, 13 Sep 2016 04:23:32 GMT

@NRB525 wrote:
Good try Pizza

The only reason to initiate a Closed by Cardholder of a card with a balance is to freeze the terms if the lender is trying to change terms. OP, has Capital One proposed changing the terms such as APR on this card? What is the limit?

You are free to close it, with a balance or without, but you still need to pay it off if there is a balance. It won't have much impact at all on your credit report, so if you are looking to "hide" the balance by putting it on a closed card, no, not going to disappear from your credit report

I thought I did ok there NRB, LOL...Everything we both have said to the OP is true.

Hopefully the OP will come back on their thread and maybe give us a little more info so folks can offer advice in his/her situation.

Re: Secured Card with a Balance?

Anonymous — Tue, 20 Sep 2016 11:35:36 GMT

Sorry i took so long to respond. Cap one is not trying to change terms. Something came up and i had to use most of the available credit on the card. The limist is $3000. I know its alot for a secured card but i was trying to increase utilization. So now i am having a hard time keeping up with my payments. I thought because the card is secured and i close it then they just end up keeping my security deposit and the balance is $0. Any advice is appreciated. Thank you.

Re: Secured Card with a Balance?

Anonymous — Tue, 20 Sep 2016 11:51:36 GMT

@Anonymous wrote:
Sorry i took so long to respond. Cap one is not trying to change terms. Something came up and i had to use most of the available credit on the card. The limist is $3000. I know its alot for a secured card but i was trying to increase utilization. So now i am having a hard time keeping up with my payments. I thought because the card is secured and i close it then they just end up keeping my security deposit and the balance is $0. Any advice is appreciated. Thank you.

Is there any way you can make a payment agreement or take a loan to pay it? Having a negative from a secured card is going to cause problems with your credit that it will take time to overcome, and $3,000 is a fairly small amount ot just walk away from without finding a different solution.

Re: Secured Card with a Balance?

Anonymous — Sat, 24 Sep 2016 22:39:12 GMT

So even if they keep the security deposit which would cover the $3000 balance, it would still affect my credit? I am wondering though has anyone else has been caught in this situation and what was the outcome.

Re: Secured Card with a Balance?

NRB525 — Tue, 20 Sep 2016 18:49:38 GMT

@Anonymous wrote:
So even if they keep the security deposit which would cover the $3000 balance, it would still affect my credit?

Yes, because the only way to get to the security deposit is if you stop paying, and that's a late.

You our might see if the will let you walk down the limit and release some of the security, so if you pay $500, maybe they reduce the CL by $500 and send you back $500 out of the deposit. Then use that $500 to pay down the balance, another CL reduction, another release of funds to you.

Or you could call them and see if they have a more efficient option. They may just move the security over to pay the balance and reduce the limit all in one go.

Re: Secured Card with a Balance?

brother7 — Tue, 20 Sep 2016 19:35:11 GMT

The proper way to close a secured card is to pay off any balance to bring it down to zero, then inform the CCC that you wish to close the secured card. At that point, they will close the card and return your security deposit.

Is it possible for you to do that?

Re: Secured Card with a Balance?

Anonymous — Tue, 20 Sep 2016 22:43:52 GMT

This is an interesting question, and I remember Capital One used to say they'd use your secured deposit to pay off your balance and would mail you the difference, but they don't say that on their site anymore. Now it says your deposit is only refundable if you close your account and pay your balance in full; I don't see any information about the security deposit being used to clear the balance anymore.

You may want to go to Capital One's chat and ask them, though. And then log out and log back in and ask a second rep to confirm (yeah, I know how cynical that sounds but sometimes you get weird information from them).

Re: Secured Card with a Balance?

Anonymous — Sat, 24 Sep 2016 16:54:41 GMT

I'm sorry to read all this but OP,please tell us what happened???

Any update s

Re: Secured Card with a Balance?

Anonymous — Sat, 24 Sep 2016 22:40:13 GMT

I would really love to pay the card in full and close it and then wait to recieve the security deposit back but i am just not able to. I guess i will try to chat with them and see what options do i have. Has anyone ever been in this situation before? and if so what was the outcome.

Re: Secured Card with a Balance?

fltireguy — Sun, 25 Sep 2016 14:28:03 GMT

I can speak from experience on this one. When you ask them to close the account, they will apply your deposit towards the entire balance. IF you have a refund due, they will send you a check. It will report just like the image below.. I closed mine, and it had about a $900 balance, and I had a $1500 deposit. I got a refund check of $600 or so a month after closing the account... Don't worry, it is NOT a derog!

Re: Secured Card with a Balance?

Anonymous — Sun, 25 Sep 2016 15:50:45 GMT

Thx for posting @fltireguy!

@Op.....that is some great news! Good luck to you! Wishing you the best!

Re: Secured Card with a Balance?

Anonymous — Mon, 26 Sep 2016 04:08:47 GMT

Wow, Thats a relief. Thank you so much for posting.