Closing accounts, identity theft, fees and FICO scoring

[Anonymous]

Hello,

My wife and I have very good FICO scores (810, 766) and we're looking to buy a house this year.  I've got (2) checking accounts with Citibank.  We have (1) joint savings account at WaMu.

Last year, the company that I work for had a finance employee's computer stolen and in fear of identity theft, I moved all of my money out of one checking account and split it between our joint savings at Wamu and my 2nd account at Citibank.   The "at risk" account at Citibank is open, but empty.  I use my 2nd Citibank account solely for paying bills.

I've started getting charged a $9.50 fee each month for not maintaining a $6k balance in Checking at Citibank. Citi is charging it to my "empty" account, which hits my LOC.

From what I've read on the boards, closing the "empty" account won't affect my credit score, but could affect my history.

It seems like I'm either stuck converting my checking accounts to a different type of account, or maintaining a $6k balance.

I'm talking to Citi this week, but I'm wondering if anyone has recommendations.   This seems like a bit of a catch-22 --- I don't want to pay $9.50 to Citibank in perpetuity, but I prefer not to totally "close" accounts if it will affect my history/score.

THANKS.    

Message Edited by FICOScott on 06-08-2008 06:42 PM

[Anonymous]

If the closed(paid)....LOC is simply closed...it should remain for 10 years...it is a positive account...if will not go away...so you'll keep the history...an I understanding it correctly???...

[athensguy]

The only way it will hurt you for now is if it makes you have too many accounts with balances.

[Anonymous]

Are you just talking about closing your checking account? If so it's not going to make any difference in your FICO score, your checking account is not on your credit report. If you mean your LOC then listen to the two people above me.

[marty56]

IMHO I would not close the account.  It could affect your score because of util and history.  Also some CCCs wont give you another CC account if you had one with them in the past and closed it.  Capitol 1 comes to mind.

Besides you get your CC statements each month so if somone uses it you wont be libel anyway.  As for paying for credit monitoring, besides the benefit in protecing your good credit scores, you get to show activity on the card which is also good.

Anyway I would keep it, especially if it is an old account.

[Anonymous]

When you close a positive TL...it's not hurting you history...because...it will remain as a positive TL for 10 more years...

[haulingthescoreup]

Everyone check out caliborne's post above. As best as I can tell, OP was talking about closing the checking account (not the LOC), because it's pulling fees from his LOC.

OP, caliborne is right. Your checking account isn't credit; it's not on your reports (or shouldn't be), and opening or closing checking and savings accounts has no impact on your credit, either in terms of scores or history. The LOC is credit, so I would definitely keep that going, as long as it hasn't been compromised. Even if it had, I would keep it open and check frequently on line for unexpected activity.

[Anonymous]

Hi everyone,

Thanks.  To clarify - both of my checking accounts have "Checking Plus" overdraft protection.  In hindsight, I probably wouldn't have gotten it - the Citibank rep made it seem like a no-brainer when I went to open a new account, but essentially, it's as though I applied for a LOC. 

 I've got two checking accounts with overdraft protection: one that I don't use because of the identity theft risk, and a 2nd account that I keep enough money in for bills (rent, etc....). 

I went in to Citibank today and the rep said I could convert to an account with a $1,500 minimum instead of $6,000.  I haven't read the fine print, but she said that would get me out of the $9.50/month charge. 

I pretty much insist on going to the branch these days.  The last time I spoke to a Citibank rep on their phone service, he insisted that "not a rupee was missing" from my account.  Whoops.     It would be nice if my bank was at least clear on the currency my funds are in.

[Anonymous]

If you are concerned with Identity Theft, why not close the account at Citi, tell them the reason why (possibility of Identity Theft) and reopen another with them?  They might help you even more because of your situation.  I don't know if they will but it's worth a shot.