Keeping Credit Cards Active

Anonymous · ‎03-07-2015

Hello All,

I was reading an article at: creditcards.com about when banks can close your credit card accounts! Some non assuring stuff I read, such as banks can for little reason at all cancel your cards. They listed obvious reasons such as late payments, going over your credit limit and failing to pay but, the scary thing to me is they can cancel if you dont use enough of your credit on a card or inactvity without any warning! Then my mind went wild at the various scenarios where they could cancel our cards if we follow the terms that go along with the card.

Link to site here:http://www.creditcards.com/credit-card-news/when-can-credit-card-issuer-close-account-1267.php

My questions are:

-What preventive measures do we have to protect them from cancelling our cards, besides paying according to the terms?

-Can they cancel if your credit scores drop for a period of time due to inquiries

Sorry if im asking simplistic questions i'm stil a little new to having multiple cards and id hate to have my cards cancelled because of something I was obliverate to beforehand. I had experience before not using my cards wisely like having a very high utilization but since I have my uti under 1 percent I'd like to stay smart with my usage.

Thank You All In Advance!

SnackTrader · ‎03-07-2015

That info is generally correct, a credit card is a line of credit at the issuer 's discretion. It can be closed or reduced at any time, with minimal recourse for you. But in the scheme of things, closures are very rare for people who behave. Make all your payments, don't run up balances you can't pay, go easy on the MEGA app sprees (10+ cards ) and you will be fine.

its also not the end of the world if a card is closed. It reports as a positive tradeline for 10 years and doesn't really do anything to your credit other than reduce outstanding credit lines. If you don't have a need for a card, feel free to close it or just let it go inactive and let the issuer close it after a matter of time. Some issuers close inactive cards quickly, some take years.

My advice is not to worry about it all too much. it's very easy to get new cards if an old card is closed (assuming your credit has recovered from your past issues), and as long as you are behaving, there is a low chance your cards will be closed anyway.

In My Wallet: Amex BCP (12/12) $50,000, Chase Freedom (12/12) $16,500, Cap1 Quicksilver (6/12) $14,000, Barclaycard Rewards (5/13) $10,500, Citi Prestige (4/16) $30,000

Last App: June 27, 2015

Gunnar419 · ‎03-07-2015

For people who have good credit, the most common reason for banks closing cards is lack of use. The method often discussed at MyFico to prevent that is either to be sure to use every one of your cards at least once per quarter for some small purchase OR put an automatic bill payment of some sort on the cards you don't otherwise use (Netflix, a monthly insurance or utility payment, cable, etc.)

Otherwise, as long as your credit remains good and the economy doesn't tank again, there's no reason to freak out and think lenders are going to close your cards.

Anonymous · ‎03-07-2015

Cool, thanks for the input! I guess i'm overreacting because I just dont want my 2 new card that I just got this month to close for any reason because I iwll need them down the road. My credit isnt bad and I dont have any negatives, I just want to make sure none of my cards get closed because I will need them when I return home from this deployment. I guess i'll make like 10$ puchases on all of them a month to make sure they report so they dont close due to inactivity.

How long should one go without making a purchase on a card? Do i have to use my cards every month or risk my caccounts going inactive?

Anonymous · ‎03-07-2015

Ah I see, you have answered my question thank you for the input!

I'll try to make a purchase around at least every 2-3 months to make sure my cards are active

DaveInAZ · ‎03-07-2015

@Gunnar419 wrote:
For people who have good credit, the most common reason for banks closing cards is lack of use. The method often discussed at MyFico to prevent that is either to be sure to use every one of your cards at least once per quarter for some small purchase OR put an automatic bill payment of some sort on the cards you don't otherwise use (Netflix, a monthly insurance or utility payment, cable, etc.)

Otherwise, as long as your credit remains good and the economy doesn't tank again, there's no reason to freak out and think lenders are going to close your cards.

Yep, that's what I do - I have a Merrick bank Visa that was very useful in rebuilding my credit, but I really don't have any use for it anymore as it's my only CC that has no rewards program. I have Netflix and another small monthly bill post to it and then pay in full before statement, forcing it to report a $0 balance & remain active. It's one of my oldest accounts so I don't want me or them to close it.

takeshi74 · ‎03-07-2015

@Anonymous wrote:
What preventive measures do we have to protect them from cancelling our cards, besides paying according to the terms?

The only thing you really need to worry about is closure due to inactivity. You have to verify with each of your creditor what their policies are and ensure that your activity meets the minimum requirements.

NRB525 · ‎03-07-2015

@Anonymous wrote:
Cool, thanks for the input! I guess i'm overreacting because I just dont want my 2 new card that I just got this month to close for any reason because I iwll need them down the road. My credit isnt bad and I dont have any negatives, I just want to make sure none of my cards get closed because I will need them when I return home from this deployment. I guess i'll make like 10$ puchases on all of them a month to make sure they report so they dont close due to inactivity.

How long should one go without making a purchase on a card? Do i have to use my cards every month or risk my caccounts going inactive?

You saw the good advice to use the cards at least once every 2-3 months to keep them active. (My Chase Freedom went nearly a year with no charges, no issues)

If you now have much more credit than you really need, and these two new cards are for the long term, then it is best to consistently use those cards you want for the long term. This not only keeps them from getting closed, but it builds a charge and payment history with those specific cards so when your spending begins to ramp up, it isn't a shock to that CCC.

The other cards become padding in your utilization and if the bank closes them, meh, you still have the cards you really wanted.

core · ‎03-07-2015

Netflix $10 + water bill $40 + insurance bill $50 + phone bill $90

Rewards lost: $3.80/mo

No thanks. Automate $0.50 Amazon gift cards with freely downloadable tools and save your money for a cocktail. Or if that's too much trouble, you could just set up recurring $1.00 donations to charity on those 4 cards and come out about the same.

DantGwyrdd · ‎03-07-2015

@core wrote:
Netflix $10 + water bill $40 + insurance bill $50 + phone bill $90
Rewards lost: $3.80/mo

No thanks. Automate $0.50 Amazon gift cards with freely downloadable tools and save your money for a cocktail. Or if that's too much trouble, you could just set up recurring $1.00 donations to charity on those 4 cards and come out about the same.

Now that sounds like a great idea.