topic Expired card not renewed. Acct closed in Understanding FICO® Scoring

Expired card not renewed. Acct closed

TeddyKG — Sat, 08 Sep 2018 07:22:33 GMT

I owe five figures to my biggest and best creditor. My card was due to expire last month and I was just informed they are not reissuing card and account has been closed. The reasons, acct was delinquent and over the limit. All true I guess but I never paid past 30 days...the last two months I literally paid on day 29 past due. The account has been slightly over the limit for 2 months

My question is twofold...I just paid them a few thousand dollars, so acct is under limit currently but credit line is gone. 1) How will this be reported and how bad will it hurt my score? 2) Can anything be done to negotiate a lower interest rate while I pay off the balance?

Any advice would be greatly appreciated.

My TU fico score is currently 660 due to high utilization. Last year at this time I was 720

Re: Expired card not renewed. Acct closed

pipeguy — Sat, 08 Sep 2018 08:49:05 GMT

First welcome to the forums - as far as your question(s) the account will be reported as closed by granter which is not a big deal, but will also report as 100% utility until paid in full - depending on what you have available in other credit limits, that may hurt your scores. Note too that if you've been running this card "maxed out" it's been reported as high utility anyway, but the difference is that the credit line is no longer available as part of your overall credit limit/utility.

The only way you remove the negative factor as far as this account's effects, is to pay the account in full and when it zero's out it'll no longer count as 100% utility.

Re: Expired card not renewed. Acct closed

Anonymous — Sat, 08 Sep 2018 11:39:03 GMT

pipeguy answered in full.

The only other option you might have is if you can balance transfer

to any other card(s) that might have either lower interest or 0% offers.

But I would take caution as other creditors may take action as a result.

If you have any/all funds to pay it off, now is the best and only time to do so.

Re: Expired card not renewed. Acct closed

TeddyKG — Sat, 08 Sep 2018 20:20:23 GMT

Thanks. I've actually been here since 2014. This place helped me tremendously and now I'm in a little jam so I will be around picking some of your brains. I just looked at account...it states my limit..and my balance which is now below my limit again but zero available credit.

Let me make sure I understand this correctly...my utilization will be 100% even if I pay another 5000 off cause the credit available is zero?

Re: Expired card not renewed. Acct closed

TeddyKG — Sat, 08 Sep 2018 20:23:04 GMT

Pipeguy...other creditors might take action even if I am in good standing with them

Fyi...I have only one past 30 days due mark on my entire credit report and that was over 18 months ago

Re: Expired card not renewed. Acct closed

TeddyKG — Sat, 08 Sep 2018 20:40:47 GMT

Also...last month a collection agent from this bank called me as they were "concerned" over limit and approching 30 days. I paid the past due immediately and told her to note account that the next month a substantial payment will be made. She made no mention account would be closed. 5 days later I received letter in mail stating card will not be renewed. I was upset cause I never ever was contacted by them about anything before and then they shut it down. I felt that was not right...she used the term delinquent but never 30 days past due with them

Re: Expired card not renewed. Acct closed

Anonymous — Sat, 08 Sep 2018 21:40:51 GMT

@TeddyKG wrote:
Thanks. I've actually been here since 2014. This place helped me tremendously and now I'm in a little jam so I will be around picking some of your brains. I just looked at account...it states my limit..and my balance which is now below my limit again but zero available credit.

Let me make sure I understand this correctly...my utilization will be 100% even if I pay another 5000 off cause the credit available is zero?

When a card is closed, FICO views that card as having a credit limit of $0, regardless of how the CL reads on the credit report. Furthermore, when your balance is greater than your CL, FICO views that accounts as 100% maxxed out.

If you put both things together, your card will read as maaxed out as long as you owe even $1 on it -- because it is closed.

A maxxed out card hurts your score.

Re: Expired card not renewed. Acct closed

iv — Sat, 08 Sep 2018 22:54:45 GMT

@TeddyKG wrote:
Also...last month a collection agent from this bank called me as they were "concerned" over limit and approching 30 days. I paid the past due immediately and told her to note account that the next month a substantial payment will be made. She made no mention account would be closed. 5 days later I received letter in mail stating card will not be renewed. I was upset cause I never ever was contacted by them about anything before and then they shut it down. I felt that was not right...she used the term delinquent but never 30 days past due with them

Even one day past the due date is delinquent. 30 days may be the cutoff for being reportable to the CRAs, but a lender seeing multiple 29-day lates in a row isn't going to be OK with that. Not at all. (Also, most lenders consider any amount over the limit to be due on the following statement, in addition to the minimum payment...)

They could have cut you off earlier, they could have not made that call at all... but they did give you a last chance there. You paid the minimum needed to get out of delinquent status - not even enough to get back under the limit? Just that and a "note" that a "substantial" payment would be made "next month" isn't good enough. If you had made a substantial enough payment during that call (enough to not only catch up on late payments and get under the limit, but also enough to not be maxed out anymore), then you would likely have been allowed to keep the card open. (And they would likely have started balance-chasing you as you paid it down, yes.)

Based on the timeline you describe, that caller was giving you a last chance, and from your insufficient response likely generated the cancellation letter right after the call ended. That's more of a chance than would be offered in many cases...

Re: Expired card not renewed. Acct closed

Pikaboo-icu — Sun, 09 Sep 2018 01:36:56 GMT

@TeddyKG wrote:
Pipeguy...other creditors might take action even if I am in good standing with them

Fyi...I have only one past 30 days due mark on my entire credit report and that was over 18 months ago

Yes, they can and have, we've read posts about it from others.

You had one 30 day late but now you have a cc "closed by grantor" that's maxed out-

I would be very careful to not draw attention from your other creditors...

Pay that closed acct off ASAP as others have advised.

Good Luck!!

Re: Expired card not renewed. Acct closed

TeddyKG — Sun, 09 Sep 2018 05:42:28 GMT

Ok thanks for all the info and advice. I can only pay half of what I owe so I guess I'm screwed for awhile...how many points lower do you think I'll sink?

Re: Expired card not renewed. Acct closed

TeddyKG — Sun, 09 Sep 2018 05:49:49 GMT

Oh one more question...during this time I also was an authorized user on my fathers American Express card. That card had an 8,000 limit. The balance is zero but since he passed away that acct has been just closed too. Does that 8,000 no longer available credit hurt me now? I know it originally helped my score when I was added several years ago

Re: Expired card not renewed. Acct closed

Anonymous — Sun, 09 Sep 2018 13:12:39 GMT

It's hard to say without knowing what your reports look like. We can advise you much better if you list all your cards with their balances and their credit limits as they currently appear on your reports. , like this:

Card 1. Balance = _____ Limit = ____

Card 2. Balance = _____ Limit = ____

Card 3. Balance = _____ Limit = ____

etc.

Make a special note if the card is closed or is an AU card or both. If there is no note we'll assume it is an open card in your name.

Re: Expired card not renewed. Acct closed

TeddyKG — Mon, 10 Sep 2018 18:37:18 GMT

Card 1. Balance = 0 Limit = 8,000 AU CLOSED

Card 2. Balance = 18,000 Limit = 21500 CLOSED

Card 3. Balance = 1,396 Limit = 1,500 OPEN

Card 4. Balance = 2,877 Limit. 3,000 OPEN

Card 5. Balance = 2,400 Limit 2,500 OPEN

Card 6 Balance = 314 Limit. 800. OPEN

Card 7 Balance = 483. Limit. 550. OPEN

Card 8 Balance = 3,593 Limit 4,000. OPEN

Card 9 Balance = 193. Limit. 1,000 OPEN

Card 10 Balance = 3231. Limit. 3,500 OPEN

Card 11 Balance. 1,500. Limit 2,000 OPEN

Card 12 Balance 2,700. Limit 3150. OPEN

Also 3 loans all over 10k paid off with zero bal now. All never late

Re: Expired card not renewed. Acct closed

Pikaboo-icu — Tue, 11 Sep 2018 00:23:02 GMT

Yikes.. A lot of cards with balances..

Many of those cards are very high uti, quite a few considered maxed out by lenders.

Is there any way you can pay those down? In a hurry?

Since you had one not renew & close your account, it's concerning that others may follow.

Sorry.. I hope it doesn't happen..

Re: Expired card not renewed. Acct closed

TeddyKG — Tue, 11 Sep 2018 01:57:12 GMT

Pikaboo

I just paid 7000 down....I cannot make another substantial payment for a few months.

How does the AU closed account work towards the overall uti? Since it was just closed that $8,000 is obviously gone. Does it stay on my report? ...does it matter? ...since it was my fathers account it was also the oldest on my report (1972) and never late

Re: Expired card not renewed. Acct closed

Pikaboo-icu — Tue, 11 Sep 2018 02:10:32 GMT

@TeddyKG wrote:
Pikaboo

I just paid 7000 down....I cannot make another substantial payment for a few months.

How does the AU closed account work towards the overall uti? Since it was just closed that $8,000 is obviously gone. Does it stay on my report? ...does it matter? ...since it was my fathers account it was also the oldest on my report (1972) and never late

Drat..

The AU card should remain for age purposes but it wont count toward your over-all uti. Since it's closed it has no available credit.

If it were me; I would pay the cards with the highest uti first, one at a time to get them below the next level.

IIRC >89% is considered maxed and the next level down is: 69%. If you can get each card below 69%, it should help.

There's some good info in this thread by ABCD2199 The-Truth-about-Credit-Card-Utilization

I know, easier said than done..

Re: Expired card not renewed. Acct closed

TeddyKG — Tue, 11 Sep 2018 02:42:30 GMT

What I meant with the AU was it actually helped me with uti when it was open cause the bal was under 2,000 with 8,000 avail. Since it just closed and I paid it....Don't I essentially lose that 8,000 cushion from the bigger picture?

Anyway thank you so much for that link...I'm gonna read it in the morning. Have a great night

Re: Expired card not renewed. Acct closed

Pikaboo-icu — Tue, 11 Sep 2018 02:48:31 GMT

@TeddyKG wrote:
What I meant with the AU was it actually helped me with uti when it was open cause the bal was under 2,000 with 8,000 avail. Since it just closed and I paid it....Don't I essentially lose that 8,000 cushion from the bigger picture?

Anyway thank you so much for that link...I'm gonna read it in the morning. Have a great night

Yes, sadly you lose that $8000 from your overall available credit so that raises your total uti. Sorry.

You shouldn't take a hit on the age though.

Hang in there.. Hopefully things will get better and my sincerest sympathy on the loss of your father.

You have a great night too.. Wish I could be more help.

Re: Expired card not renewed. Acct closed

AndySoCal — Tue, 11 Sep 2018 03:16:55 GMT

If your payment posted before the 30 days you dodged a late payment on your credit report. If not the 30 day late will casue your score to take a major hit. The affect on you credit utilization will cost you some points but not as many since you have paid the account balance down. Keep in mind with account over the credit limit and being board line late is sending a negative message to the creditor. In some cases not all this warning sign that account is about to go bad. The creditor made the decision to close the account. With credit card debt that goes bad the creditor loses money on the account.

A few years ago I somehow did not put a credit card bill into my bill pay. I noticed the error and I called the bank which I also bank with. The representative set up the payment so it post before it was 30 days late. The representative said if I had waited another couple days they would have frozen the account (no more transactions) account is still open or they would have closed the account. I learned a big lesson and now a double check what is in my bill pay and have set up ebills in bill pay.

Re: Expired card not renewed. Acct closed

Anonymous — Tue, 11 Sep 2018 05:32:13 GMT

@TeddyKG wrote:

How does the AU closed account work towards the overall uti? Since it was just closed that $8,000 is obviously gone. Does it stay on my report? ...

Have you checked your three reports? Is it currently listed on all three reports as a closed account?

The advice you are getting is good. In order of importance you should be...

(a) never being late on a payment

(b) always paying at least $2 more than than the minimum payment on every card

(d) paying all cards to under 69%

(e) paying off all CC debt in whatever remaining order you like, as long as all debt is paid off

The most serious problem you have is card #2:

Card 2. Balance = 18,000 Limit = 21500 CLOSED

THat card will be considered maxxed out until it is paid to zero and the limit will be considered by FICO to be $0.

I encourage you to not use any credit cards until they are all paid to zero.