Credit Card Non-Use/Bank Termination - FICO Impact?

[Anonymous]

Have recently received notification from issuing bank that as a result of non-use my MasterCard account is to be terminated.  No prior notification was received that this account was jeopardized.  Current FICO is in range of 780+.  How does this affect (if any) current FICO scores?  If so, what is recommended to re-establish current score?  If a reinstatement of the account was requested and accommodated by the issuing bank, how would THAT impact FICO score?...Thanks

[mssher]

Hi, which lender is closing your card?  How long have you had the card?  Do you have a balance on the card?  If so, what is your utilization?  Have any other changes happened to your credit which would look risky to a lender?

[Revelate]

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@Anonymous wrote:

Have recently received notification from issuing bank that as a result of non-use my MasterCard account is to be terminated.  No prior notification was received that this account was jeopardized.  Current FICO is in range of 780+.  How does this affect (if any) current FICO scores?  If so, what is recommended to re-establish current score?  If a reinstatement of the account was requested and accommodated by the issuing bank, how would THAT impact FICO score?...Thanks

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Assuming it's zero balance in this case, if the limit on the card doesn't materially affect your revolving utilization there will be no impact for the next 10 years, by which time losing the one account is probably trivial anyway (when it falls off your report).

If the lender is willing to reconsider, likewise would be no impact: tradeline would remain open.

Which lender / card was it out of curiosity and how long was it idle for?

[Anonymous]

(1) CitiBank (2) Card/Account has existed for greater than 10 years (3) no balance (4) Haven't used the card for >6 months (5) am aware of no other changes that would affect credit - i.e. no outstanding balances, past due amounts, loan applications, judgements, liens, all other credit balances paid in full when due, etc.

[RobertEG]

It depends upon whether they will also delete the account after its closure.

If they delete, you will, of course, loose its age in your AAoA calculation.

[Anonymous]

Hi Indyson.  Two questions that have not yet been asked:

    (a) Is this your oldest account?

    (b) if so, how much older is it than the next oldest?

RobertEG... is that possible?  I didn't know it was possible for a creditor to remove a true record from your profile (especially without your consent).  It seems as though this was a real account Indyson had for many years (all the way up till very recently).  The CCC almost certainly has the right to close it, but I am surprised they have the right to falsely assert that he never had it. 

[Anonymous]

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@Anonymous wrote:

Hi Indyson.  Two questions that have not yet been asked:

    (a) Is this your oldest account?

    (b) if so, how much older is it than the next oldest?

RobertEG... is that possible?  I didn't know it was possible for a creditor to remove a true record from your profile (especially without your consent).  It seems as though this was a real account Indyson had for many years (all the way up till very recently).  The CCC almost certainly has the right to close it, but I am surprised they have the right to falsely assert that he never had it. 

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Creditors have every right to delete an entry from a credit file. It rarely happens, and when it does it's usually one of the sleazy companies like Credit One.

[Anonymous]

Always curious to learn more about what's possible in Credit Land.  I just googled it and found this article at Experian:

http://www.experian.com/blogs/ask-experian/2013/11/20/a-creditor-can-request-that-an-account-be-remo...

EX points out that the creditor has two rights:

1. To choose whether it initially wants to report an account or not
2. To request that the CRA change a record it has previously reported (but only if the creditor believes there is false information that was inadvertently reported)

From the way EX describes it,  the record doesn't belong to the creditor (to delete or not as it likes).  It sounds like, once reported, it is the CRA's.  The creditor has a right to request that the CRA change or delete it, which is different from the right to make the change.

My guess is that, if the CCC were to unilaterally delete a positive account, the consumer could dispute that action since it was the removal of true information.

[Anonymous]

Thanks for all the tiemly responses - much appreciated!

Have further checked in with my resident CFO (i.e. wife) in relation to the account in question.  It appears I misspoke in my initial query and erroneously referenced our seldom-used AT&T UniversalCard (M/Card).  The actual account in question is a Citi Platinum M/Card that was opened 5+ years ago and was then used for only 1 transaction (don't ask!) that was paid in full when it was due back then.  The current balance is $0.00 and no outstanding charges exist.  Since we periodically use the AT&T M/Card without a problem AND the existence of the Platinum Card has not made a +/- impact on our FICO over the past 5 years, we have decided to allow the bank to terminate the account without reservation.

Should you or others have any further recommendations that we should take with the bank to ensure the integrity of our FICO, it would be greatly appreciated... Thanks again, in advance for your interest, counsel, and information.

[Revelate]

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@Anonymous wrote:

Always curious to learn more about what's possible in Credit Land.  I just googled it and found this article at Experian:

http://www.experian.com/blogs/ask-experian/2013/11/20/a-creditor-can-request-that-an-account-be-removed-from-your-credit-report/

EX points out that the creditor has two rights:

1. To choose whether it initially wants to report an account or not
2. To request that the CRA change a record it has previously reported (but only if the creditor believes there is false information that was inadvertently reported)

From the way EX describes it,  the record doesn't belong to the creditor (to delete or not as it likes).  It sounds like, once reported, it is the CRA's.  The creditor has a right to request that the CRA change or delete it, which is different from the right to make the change.

My guess is that, if the CCC were to unilaterally delete a positive account, the consumer could dispute that action since it was the removal of true information.

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It's impossible to dispute something that's not on your credit report, system just isn't setup that way nor are the current legal regulations to my understanding; the lender is under no obligation to report period except in perhaps the T&C they signed up for with the individual bureaus in question.