What happens when a card becomes extinct?

[MontegoMack]

What happens when a card no longer exists?

What happens to the account that you have, but can no longer keep valid because that card no longer exists?

There are some co-branded cards that over the years, are no longer available to app for. Banks have had cards that have become "extinct." Do those card holders then get another product by that bank?

I saw a forum discussion here about FNBO offering a SavingStar Secured American Express. Someone was fairly disparaging about how long SavingStar would last (predicting only a year or two). What would happen to the cardholder's product? Would they get another card by FNBO?

Thank you in advance.

[UncleB]

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@MontegoMack wrote:

What happens when a card no longer exists?

What happens to the account that you have, but can no longer keep valid because that card no longer exists?

There are some co-branded cards that over the years, are no longer available to app for. Banks have had cards that have become "extinct." Do those card holders then get another product by that bank?

I saw a forum discussion here about FNBO offering a SavingStar Secured American Express. Someone was fairly disparaging about how long SavingStar would last (predicting only a year or two). What would happen to the cardholder's product? Would they get another card by FNBO?

Thank you in advance.

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It's really up to the bank.  They can either PC the 'extinct' cards to a different product type, sell the accounts to another lender, or occasionally just close the account.

I actually had the last happen to me once, to my very first credit card I got after my bankruptcy years ago.  I got a notice that as of a certain date all accounts would be closed... I called and the CSR told me the account would be designated "Closed by Consumer" on my credit reports, but I didn't trust him so I requested for him to close my account immediately just to be sure.  It was quite a let-down, but there was nothing I could do about it.

If it's a larger bank, though, they would most likely want to keep the customer (if for no other reason to sell to another bank) so in general I would expect the account to either be PC'ed or sold.

Edited to add:  Most issuers now seem to let the customer keep the 'extinct' account for as long as they want, but they simply don't take new applications (i.e. existing card holders are 'grandfathered'.)

[MontegoMack]

So the banks have options. They could:

1. Close the account. The card holder is SOL

2. Offer another product from that bank

3. Sell the account to another bank??

Did I get that right?

[kdm31091]

It really does vary. Usually, but not always, existing users are allowed to keep the card right when applications are closed. In rare cases, the issuer may immediately convert users to a different product. Generally though, it can be months or even years. Usually, sooner or later, it does happen, but the timeline varies quite a lot.

[Anonymous]

Yeah I had a Chase Flexible Rewards card was 13 years old. I'm pretty sure they discontinued that card at least 7 years ago but it was still the same card for me. I recently PC it myself but who knows how long they would've let me keep it

[XxRaVeNxX1]

Isn't there another option? The account stays open and active?

Isn't that what happened with the sallie Mae credit cards?

[UncleB]

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@XxRaVeNxX1 wrote:

Isn't there another option? The account stays open and active?

Isn't that what happened with the sallie Mae credit cards?

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Yep, that's the 'grandfather' option where existing cardholders are allowed to keep what they have. 

It's generally the best (most desirable) option for the cardholders who have that particular card type.

[Themanwhocan]

And then there is the option where the card becomes even better over time. For example, the Priceline visa. It was 2% cash back, then they switched it to 1% and the existing cards were grandfathered. Then they added a 10% bonus when redeeming points for travel, and that bonus was even added to the grandfathered cards, making those 2.22% cards when points are used for travel, 2% otherwise.

[Anonymous]

In addition to what others have said and as a point of reference, I have a Wells Fargo Prime for Life card from back in 2006 which no longer exists. The card design has changed (no longer says prime for life on the card), cash back rewards has been added, but the terms of the card have not changed and the rate remains the same.

Basically it all depends on the bank and what they choose to do. The terms do not have to stay the same as they can change at anytime without notice. The only reason I think my terms have not changed is because the original agreement actually stated Prime "for life".

[Anonymous]

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@Themanwhocan wrote:

And then there is the option where the card becomes even better over time. For example, the Priceline visa. It was 2% cash back, then they switched it to 1% and the existing cards were grandfathered. Then they added a 10% bonus when redeeming points for travel, and that bonus was even added to the grandfathered cards, making those 2.22% cards when points are used for travel, 2% otherwise.

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The Priceline experience is what should give Sallie Mae users some hope.  Barclays has continued the grandfathered rate for quite some time.   Of course, they could decice to do something very different with Sallie Mae, but hopefully not.

The Citi Forward represents another possibility.   After grandfathering, it can just be nerfed, without being PCd to another card.