Bank Of America closed accounts & reduced credit lines - What to do?

[Anonymous]

Got 3 letters from BOA yesterday notifying us that they were closing an account from 1996 with a $50K credit line, reducing one with a $44K line to $29K and reducing fron from $19K to $15K.

We are carrying a balance of $28K on on of these cards and $12K on another. The account that was closed had a Zero balance on it.

2 of these accounts are in my wife's name and 1 in mine.

I had called Bank of America about a week ago to request a lower APR on the account with the balance. I was transferred to an analyst that "reviewed" our accounts and basically refused to lower the rate. Unfortunately, I was not very nice to her when she refused. I told her that we have many accounts with BOA; we have quite a bit of money on deposit and we have 2 retirement accounts as well. I demanded to speak to a supervisor but she told me that the final decision was hers and that was that.

We have NEVER been late and have been paying these accounts down very aggressivedly. Before this fiasco, my average (across all 3 agencies) score was in the 790-812 range and my wifes's score was in the 820-850 range. I am not sure what promoted this. We have always been extremely careful with our credit but this baffles me to no end.

I feel that she acted spitefully because I got upset when she refused to lower the rate and the result was a "review" of our accounts and the subsequent closure/reduction of credit lines.

WE have been with BOA for 8 years now and 2 of the credit card accounts are from what was MBNA (since the mid 90s). Closing these accounts and bringing the credit limit down will impact our scores in a big way. I havent checked the updated scores (I am actually afraid to) but I will.

Can anyone offer any suggestions or advice? I am baffled and quite upset because of the potential domino effect.

Thanks!

[Anonymous]

Is the 28K balance on the card that was reduced to 29K? It looks like a typical modern banking house cleaning to me. This is happening everyday to a very large number of people.

[Anonymous]

PS, are those score ranges FICO scores? There are a bit high for the balances as discribed.

[Anonymous]

Yes. Because I called to ask them to lower the rate. I have been kicking myself since then. Really hard. Had I not called them. this would have not happened. The balance on this card was close to $40K last year and we have been aggressively paying it down. So this makes zero sense. And to purposely do this. It is despicable. We WANT to be DEBT FREE and we are no longer using credit cards AT ALL. So this gets even more aggravating.

[haulingthescoreup]

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beenthere wrote:
Is the 28K balance on the card that was reduced to 29K? It looks like a typical modern banking house cleaning to me. This is happening everyday to a very large number of people.

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...and especially to those who call up BofA and ask for something.

Hi, thrajman, and welcome to the forums! Sorry it's under such circumstances.

Score damage can result if you have balances on other cards and BofA starts to report the CL's on these accounts as $0. Since that would reduce your total available credit, your revolving util (utilization; the amount you owe divided by your credit limits) would climb. But usually when accounts are closed with a balance, the CL continues to report and is figured into your total CL. Then typically, once you pay them off, the CL's will revert to $0.

So for now, you might be OK. The closed accounts should continue to report for 10 years, helping your amount of history. (Although Equifax is bad about dropping closed accounts before the 10th year.)

Check out fused's "Closing credit cards", linked in my siggy below. He gives a good explanation of what's what in terms of closing accounts and FICO scoring.

[Anonymous]

first off, welcome to the forums. i hope they'll be as much help to you as they have been to me. 

i'm sorry to hear about the account review. i can imagine how frustrated you must feel. if you do a search for BOA on these forums, you'll find that many customers have been subjected to these account reviews in the last 12 months no matter how polite they were, so don't feel like your tone w/ the CSR or your demands had something to do with the outcome. as a matter of fact, you'll find that people on these forums (and other popular ones too) post about how concerned they are about calling in for a credit line increase or change in APR and wind up with a dreaded account review.

BOA is aggressively trying to reduce risk on their CC accounts and have gone after those carrying large balances with large credit lines that have grown with them throughout the years (in your case, in the last decade or two)--even those with flawless payment history.

it sounds like BOA is starting to "balance chase" you. some of the more experienced folks on these forums may be able to offer good strategies to paying down your balances from here on out. don't be surprised if they continue to reduce your credit limit as you continue to pay your balances down. 

you can always call the "backdoor" number provided in this forum and get them to reopen your closed account even if it's at a lower limit. i also suggest you write directly to the CEO's office in Charlotte, NC by mail AND planetfeedback (dot com) about your situation if you are unsuccessful in getting a favorable outcome from calling directly into the backdoor number.

good luck!

[Anonymous]

I had checked our credit scores BEFORE calling them. These are on a 990 scale as reported by TrueCredit across 3 bureaus. Basically putting me in the B grade range my wife in the A grade range.

Thanks.

[haulingthescoreup]

Just so you realize, those are FAKO scores. If they start jumping around, they don't necessarily match what's happening with your FICO scores.

We call them FAKO's because they're not used by lenders. They seem to exist to confuse consumers and enrich the folks who sell them.

And again, any change or lack of change on the FAKO's don't automatically indicate something similar on your FICO's.

[MarineVietVet]

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@Anonymous wrote:

I had checked our credit scores BEFORE calling them. These are on a 990 scale as reported by TrueCredit across 3 bureaus. Basically putting me in the B grade range my wife in the A grade range.

Thanks.

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No one has been able to pull their own Experian FICO score since last February. Creditors can pull Experian and also there is a CU in Pennsylvania that supplies that information to it's members only. You can only buy true FICO scores at a few places. One place is here at myfico. I suggest you do an internet search for "myfico discount codes" to save a little money. You can also purchase your Equifax score at www.equifax.com and your Transunion score at www.transunioncs.com.

From a BK years ago to:
7/09 TU-742 EQ- 779
8/09 TU-765 EQ- 783
9/09 EX pulled by lender 802

You can do the same thing with hard work

Credit Scoring 101
Common Abbreviations
Frequently Requested Threads
Credit Problems Which Is Worse?
Whats In Your FICO Score

[marty56]

I would terminate any dealings with them and move all your accounts to a CU.