Synchrony bank closing accounts due to high risk of non payment?

[tehdrizzle]

So I posted the other day about PenFed lowering our credit limit on our powercash and gold cards due to inactivity here: https://ficoforums.myfico.com/t5/Credit-Cards/Penfed-lowering-credit-limits/td-p/6785640/page/2.

In short, we have near perfect credit, PIF every month, have a mortgage, auto loan, 3% utilization on revolving debt, and and we make over 230k per year with scores in the 830-840 range across the board.

Synchrony just sent us a stack of letter saying that we are considered a high risk of non payment and as such they have closed all of our accounts. The largest was a 45k limit with Lowes which we just used and then paid off in 4 months in the amount of 27k for a kitchen remodel. I total our available credit has now dropped by 82k and our scores have dropped by over 70 points. What is going on with these companies and does the "risk of non payment" as a reason hurt my credit further? This is ridiculous!

If this reason hurts it further I may opt to close all of my cards and take that hit rather than let them hit me with a high risk of non payment message.

[MissLiz]

I'm so sorry this happened to you. Sync has a history of doing this, especially when they see other issuers have CLD'ed. 

[tehdrizzle]

Any idea if having them close the account as a high risk hurts my scores even more? If so I may opt to close all of my remaining credit cards to avoid anything like that hurting and just take the huge hit from having no credit cards or revolving balance.

[pizzadude]

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@tehdrizzle wrote:

Any idea if having them close the account as a high risk hurts my scores even more? If so I may opt to close all of my remaining credit cards to avoid anything like that hurting and just take the huge hit from having no credit cards or revolving balance.

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At least they gave you a reason for closing your account, Synchrony is known to shut people down with little or no notice and without explanation. 

The "high risk of non-payment" reason won't appear on your reports or affect your FICO score.  

[tehdrizzle]

@pizzadude thanks for the info. I'll leave my other lines open and hope they too don't decide to reduce or close for no reason.

[Zeiram]

Surprising how blunt they were. Usually they just don't explain themselves because there's no reason they have to.

[Anonymous]

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@tehdrizzle wrote:

Any idea if having them close the account as a high risk hurts my scores even more? If so I may opt to close all of my remaining credit cards to avoid anything like that hurting and just take the huge hit from having no credit cards or revolving balance.

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Why do you think that closing all  your cards will be better (for scores) than the potential risk of an issuer closing some?  For scores it doesn't matter who closes it.

[UncleB]

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@tehdrizzle wrote:

So I posted the other day about PenFed lowering our credit limit on our powercash and gold cards due to inactivity here: https://ficoforums.myfico.com/t5/Credit-Cards/Penfed-lowering-credit-limits/td-p/6785640/page/2.

In short, we have near perfect credit, PIF every month, have a mortgage, auto loan, 3% utilization on revolving debt, and and we make over 230k per year with scores in the 830-840 range across the board.

Synchrony just sent us a stack of letter saying that we are considered a high risk of non payment and as such they have closed all of our accounts. The largest was a 45k limit with Lowes which we just used and then paid off in 4 months in the amount of 27k for a kitchen remodel. I total our available credit has now dropped by 82k and our scores have dropped by over 70 points. What is going on with these companies and does the "risk of non payment" as a reason hurt my credit further? This is ridiculous!

If this reason hurts it further I may opt to close all of my cards and take that hit rather than let them hit me with a high risk of non payment message.

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I'm sorry this has happened; you're definitely not the first (and certainly won't be the last).

Just a quick question; you mention your scores dropped by 70 points - was that FICO or Vantage?  Vantage scores (like Credit Karma, etc.) are known to be sensitive to utilization like this but thankfully not many lenders use it.  If you haven't already, check your FICO scores - things might not be as bad as you think.

[tehdrizzle]

@UncleB  unfortunately that was my fico that dropped that harshly.

[CreditPoor]

Synchrony wants transactors who pay some interest, make more than the minimum payment and aren't carrying balances month over month on other cards.