topic Re: Going, going, gone . . . in Credit Cards

Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 17:35:28 GMT

On November 23rd, I had 3 credit cards closed without warning. HSBC 4200 (unused for 6 months), Shell 1000 & Citgo 900 never used. Calls to each of these said they were closed for non-use, that I should re-apply. I don't really need these cards and I don't carry any cc debt - I was wondering

(a) is this happening to anyone else and (b) will this hurt my FICO score?

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 17:39:03 GMT

1. This is very common, especially with major cards. You need to use them at least 1x every couple months or they will cancel for inactivity.

2. While this won't hurt your AAoA, history or rating, it MIGHT hurt you on number of open TL's....FICO likes 3-5 open revolving TL's. Do you have another other open CC's?

IMO, you might see some small changes in your FICO if you have less than 3 open revolving accounts now. These accounts will continue to report on your CR's (closed) for about 10 years (EQ sometimes drops prematurely). So these will continue to be positive in that manner. However, lenders like to see open TL's with some payment history and use.

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 17:55:31 GMT

@Anonymous wrote:
, it MIGHT hurt you on number of open TL's....FICO likes 3-5 open revolving TL's. Do you have another other open CC's?

IMO, you might see some small changes in your FICO if you have less than 3 open revolving accounts now. These accounts will continue to report on your CR's (closed) for about 10 years (EQ sometimes drops prematurely). So these will continue to be positive in that manner. However, lenders like to see open TL's with some payment history and use.

YMMV. I didn't see any damage for having fewer than 3 open revolving accounts - nor did DH. DH was over 800 FICO with only one.

You will see point differences for having at least one open bank/national credit card account - but you only need one of those. If your HSBC card was your only bank card, you will see a significant score drop (potentially ~ 20 points).

On the other hand, you can have too many bank cards. Some recent posts indicate the magic number of TOO MANY of those accounts may be six. And again, YMMV.

And you can have TOO MANY established accounts.

So, if you have another bank card open, you are totally good. If HSBC was your only bank card, you will see a significant score drop until you open another bank card.

Look at it this way, with all those cards closed, you'll have more room in your sock drawer for all those Christmas socks!

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 18:06:40 GMT

Thanks for the replies. I have a NFCU Visa with 18K CL and a local CU mastercard with 10K CL, so I didn't really need them. This is my first (and probably not my last) AA so I was feeling insulted. Just had some of the "weeds" cut from my credit garden for me. LOL

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 18:19:34 GMT

Yep - looks like your garden is pretty golden. Congrats!

Just remember, though, that even though your CU cards have lovely CL's - they do not qualify as a bank/national credit card. From your list, it looks like HSBC was your only bank card, and losing that card will cost you plenty of points.

To keep your scores from dipping, you might want to consider app'ing for a bank card. FICO gods grumble when you don't have one (it's their code #3 "Too Few Bank Revolving Accounts" for EQ & EXP - TU doesn't have one). It can be a credit card, home equity loan, or personal line of credit; and it doesn't need to have a balance - it just needs to be open.

DH gained 28 points when opening his (first at the time); and I gained 20.

Best wishes!

Message Edited by beamMEup on 11-30-2009 11:19 AM

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 19:16:00 GMT

I have a Hilton Honors Citibank with a 9K CL? Is that considered a bank card?

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 19:26:41 GMT

@Anonymous wrote:
I have a Hilton Honors Citibank with a 9K CL? Is that considered a bank card?

Heck yeah!

Re: Going, going, gone . . .

Anonymous — Mon, 30 Nov 2009 20:10:41 GMT

@Anonymous wrote:
@Anonymous wrote:
, it MIGHT hurt you on number of open TL's....FICO likes 3-5 open revolving TL's. Do you have another other open CC's?

IMO, you might see some small changes in your FICO if you have less than 3 open revolving accounts now. These accounts will continue to report on your CR's (closed) for about 10 years (EQ sometimes drops prematurely). So these will continue to be positive in that manner. However, lenders like to see open TL's with some payment history and use.

YMMV. I didn't see any damage for having fewer than 3 open revolving accounts - nor did DH. DH was over 800 FICO with only one.
You will see point differences for having at least one open bank/national credit card account - but you only need one of those. If your HSBC card was your only bank card, you will see a significant score drop (potentially ~ 20 points).

On the other hand, you can have too many bank cards. Some recent posts indicate the magic number of TOO MANY of those accounts may be six. And again, YMMV.

And you can have TOO MANY established accounts.

So, if you have another bank card open, you are totally good. If HSBC was your only bank card, you will see a significant score drop until you open another bank card.

Look at it this way, with all those cards closed, you'll have more room in your sock drawer for all those Christmas socks!

You'll notice the emphasis on MIGHT in my post.

Re: Going, going, gone . . .

Anonymous — Tue, 01 Dec 2009 01:32:29 GMT

@Anonymous wrote:
Yep - looks like your garden is pretty golden. Congrats!

Just remember, though, that even though your CU cards have lovely CL's - they do not qualify as a bank/national credit card. From your list, it looks like HSBC was your only bank card, and losing that card will cost you plenty of p

This is not correct any Visa MC Amex or Discover works, does not matter who backs it

Re: Going, going, gone . . .

haulingthescoreup — Tue, 01 Dec 2009 01:53:38 GMT

rbbyrbsn wrote:

@Anonymous wrote:

Yep - looks like your garden is pretty golden. Congrats!

Just remember, though, that even though your CU cards have lovely CL's - they do not qualify as a bank/national credit card. From your list, it looks like HSBC was your only bank card, and losing that card will cost you plenty of points.
This is not correct any Visa MC Amex or Discover works, does not matter who backs it

No, in fact, beamMEup is correct. The FICO scoring formula will mark you down if all your cards are from credit unions or smaller regional banks. USAA is included in "credit unions", btw. We found this out on the boards about 18 months ago, confirmed by myFICO admin Barry.

It's not a huge ding, but it does exist. It's up to each consumer to decide whether to pick up one card issued by a bank with national presence.

At any rate, OP has a Citi-issued card, so she should be OK.

OP, I'm a bit envious. You have three very good cards, and you are now freed from the mini-hassle of trying to keep all your cards exercised and amused.