topic Re: Sears card, close now or close later? in Credit Cards

Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 18:46:52 GMT

Well, all the payments have posted to my husbands Sears card that credit limit decreased him, and it appears they have lowered it even further, to $492. I assume this means they intend to close after this statement date. What will it report if closed now? The old credit limit or the new credit limit? Should we preemptively close it?

Re: Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 19:13:12 GMT

If you feel confident that they're leaning towards closing the account, I would definitely recommend that you pre-empt them. It will look much better on your credit report(s) if the account is closed by consumer instead of being closed by credit grantor.

Re: Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 19:20:33 GMT

Close it yourself. I don't mind the differences in how it is listed. The main reason is to maintain the credit line reported after closing. If I was getting balanced chased, I would have closed it ASAP so it reported as high credit limit as possible and paid down account. I believe if you do this, the credit limit still figures into util calculations.

Re: Sears card, close now or close later?

bichonmom — Fri, 25 May 2012 19:38:38 GMT

@Anonymous wrote:
Close it yourself. I don't mind the differences in how it is listed. The main reason is to maintain the credit line reported after closing. If I was getting balanced chased, I would have closed it ASAP so it reported as high credit limit as possible and paid down account. I believe if you do this, the credit limit still figures into util calculations.

After an acct is closed, the CL does not count towards util any longer.

It seems like they're being excessively nasty. Could be that it's coded to automatically CLD as the bal goes down. I can't imagine there's a human who's keeping track of his acct this closely. Your experience has just validated my decision to not try and get a Citi card again.

If I were you, I would go ahead and close it. Even if they did not close it, it sounds like you don't want to do business w/them any longer. And it looks like they're either going to CLD so low that it's useless or close the acct altogether.

Re: Sears card, close now or close later?

marty56 — Fri, 25 May 2012 19:45:52 GMT

@Anonymous wrote:
If you feel confident that they're leaning towards closing the account, I would definitely recommend that you pre-empt them. It will look much better on your credit report(s) if the account is closed by consumer instead of being closed by credit grantor.

No and it won't.

Account comments have zero effect on your FICO score and from my experience lenders don't care about them.

Re: Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 19:55:00 GMT

@bichonmom wrote:
@Anonymous wrote:
Close it yourself. I don't mind the differences in how it is listed. The main reason is to maintain the credit line reported after closing. If I was getting balanced chased, I would have closed it ASAP so it reported as high credit limit as possible and paid down account. I believe if you do this, the credit limit still figures into util calculations.

After an acct is closed, the CL does not count towards util any longer.

It seems like they're being excessively nasty. Could be that it's coded to automatically CLD as the bal goes down. I can't imagine there's a human who's keeping track of his acct this closely. Your experience has just validated my decision to not try and get a Citi card again.

If I were you, I would go ahead and close it. Even if they did not close it, it sounds like you don't want to do business w/them any longer. And it looks like they're either going to CLD so low that it's useless or close the acct altogether.

Yeah, I think it's just automatically decreasing. The number of $1050 was suspect to me as a permanent credit limit. I figured right away that it was just as low as they could legally lower it, but not as low as they wanted it to go. Citi had the nerve to send him a preselected offer for Citi Diamond Select. Hahahaha, like that would ever happen. Finally got the letter for why they are credit limiti decreasing, "not enough credit history" was the #1, followed by balances on accounts. Funny since it was only his second credit card after moving to the US and he has a lot more credit history now than when he got approved for the card. They said he had a 659 Equifax Fico (phone rep), but it was actually an in house fako that ranged between 200-900. I'm just really unimpressed.

Re: Sears card, close now or close later?

MarineVietVet — Fri, 25 May 2012 20:07:51 GMT

@Anonymous wrote:
If you feel confident that they're leaning towards closing the account, I would definitely recommend that you pre-empt them. It will look much better on your credit report(s) if the account is closed by consumer instead of being closed by credit grantor.

It doesn't matter whether the account is closed by the consumer or the issuer. It's looked at the same.

ETA: Marty beat me to it!

Re: Sears card, close now or close later?

MarineVietVet — Fri, 25 May 2012 20:09:34 GMT

@bichonmom wrote:

After an acct is closed, the CL does not count towards util any longer.

It seems like they're being excessively nasty. Could be that it's coded to automatically CLD as the bal goes down. I can't imagine there's a human who's keeping track of his acct this closely. Your experience has just validated my decision to not try and get a Citi card again.

If I were you, I would go ahead and close it. Even if they did not close it, it sounds like you don't want to do business w/them any longer. And it looks like they're either going to CLD so low that it's useless or close the acct altogether.

This isn't always true and there doesn't seem to be any pattern to it. Some CCC's will continue to report a CL after the account is closed and some won't.

Re: Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 20:12:10 GMT

@MarineVietVet wrote:
@Anonymous wrote:
If you feel confident that they're leaning towards closing the account, I would definitely recommend that you pre-empt them. It will look much better on your credit report(s) if the account is closed by consumer instead of being closed by credit grantor.
It doesn't matter whether the account is closed by the consumer or the issuer. It's looked at the same.

ETA: Marty beat me to it!

Isn't this going to raise flags if a report is being reviewed by a credit analyst??

Re: Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 20:13:59 GMT

@MarineVietVet wrote:
@bichonmom wrote:

After an acct is closed, the CL does not count towards util any longer.

It seems like they're being excessively nasty. Could be that it's coded to automatically CLD as the bal goes down. I can't imagine there's a human who's keeping track of his acct this closely. Your experience has just validated my decision to not try and get a Citi card again.

If I were you, I would go ahead and close it. Even if they did not close it, it sounds like you don't want to do business w/them any longer. And it looks like they're either going to CLD so low that it's useless or close the acct altogether.
This isn't always true and there doesn't seem to be any pattern to it. Some CCC's will continue to report a CL after the account is closed and some won't.

Even if the CL is reported, I thought that the trade line wouldn't factor into util as long as their is a zero balance. Is that wrong?

Re: Sears card, close now or close later?

lithium78 — Fri, 25 May 2012 20:14:19 GMT

If nothing else, it might make you feel better about being the one to kick them to the curb, rather than the other way around.

Re: Sears card, close now or close later?

marty56 — Fri, 25 May 2012 20:16:34 GMT

I was in a DMP, so I had comments in my CR that the accounts were both closed and in a CCCS, yet I got a mortgage refi at the CU's best rates, autoloan and CCs all at the best rates. MY FICO score during all of this was from 740 - 767.

Re: Sears card, close now or close later?

MarineVietVet — Fri, 25 May 2012 20:21:19 GMT

@Anonymous wrote:

Even if the CL is reported, I thought that the trade line wouldn't factor into util as long as their is a zero balance. Is that wrong?

You are correct about this. Both a CL and a balance on a closed credit card account have to be reporting for the account to be factored into utilization.

Re: Sears card, close now or close later?

bichonmom — Fri, 25 May 2012 20:21:50 GMT

@lithium78 wrote:
If nothing else, it might make you feel better about being the one to kick them to the curb, rather than the other way around.

+1!

Re: Sears card, close now or close later?

MarineVietVet — Fri, 25 May 2012 20:24:13 GMT

@Anonymous wrote:
It doesn't matter whether the account is closed by the consumer or the issuer. It's looked at the same.

ETA: Marty beat me to it!
Isn't this going to raise flags if a report is being reviewed by a credit analyst??

At one time it probably would but as crazy as the credit world has been the last few years with accounts closed left and right by issuers the stigma that was once attached to "account closed by credit grantor" has disappeared.

Re: Sears card, close now or close later?

bichonmom — Fri, 25 May 2012 20:27:06 GMT

@MarineVietVet wrote:
@Anonymous wrote:

Even if the CL is reported, I thought that the trade line wouldn't factor into util as long as their is a zero balance. Is that wrong?
You are correct about this. Both a CL and a balance on a closed credit card account have to be reporting for the account to be factored into utilization.

Okay. That makes sense, then. That's why I thought that closed CL didn't count towards util. I was going on the assumption that the acct had been PIF.

Re: Sears card, close now or close later?

Anonymous — Fri, 25 May 2012 20:32:15 GMT

@MarineVietVet wrote:
@Anonymous wrote:
It doesn't matter whether the account is closed by the consumer or the issuer. It's looked at the same.

ETA: Marty beat me to it!
Isn't this going to raise flags if a report is being reviewed by a credit analyst??
At one time it probably would but as crazy as the credit world has been the last few years with accounts closed left and right by issuers the stigma that was once attached to "account closed by credit grantor" has disappeared.

Good point. Thanks for explaining that.