Re: Credit Utilization?

Anonymous · ‎04-19-2009

Utilization on closed credit cards is counted...your original credit limit on that card is what is no longer factored into your utilization. You now owe over $14,000 on a card with a $100 credit limit. NOT $14,000 on a $22,000 card

If you owed only $100 on this ccard you would be at 100% utilization.

YES, this is killing your scores. You should pay off these closed cards as quickly as possible!

Message Edited by VEEnVEGAS on 04-19-2009 04:12 AM

JBoswell · ‎04-19-2009

So it's not really a resolution at all. What was the point then in them updating the description to say "Amount in H/C Column is credit limit"? Why not have just left it alone if it makes no difference. lol. Yesterday I also got a mail response to the letter I had sent them in which they said "the high balance reported is accurate based on our investigations and we have enclosed a copy of your previous bill for validation" --- which, yea, the high balance is accurate, but that wasn't even remotely when I was disputing. I disputed the credit limit. But in all of my correspondence to them they ignore my requests for fixing that and just "validate" some other random information that I wasn't even inquiring about. @)(#*)!@*#%@#%^!@ it's just getting so frustraiting.
The dispute actually helped my score, Utl. changed from the 329842074108410948% to "not reported" so I guess my score will drop again when resolved. I probably should have waited to get the reports until AFTER it was resolved because I've also had several collections removed and now I have no idea what my actual (not dispute confused) credit score is.

and to the other response...

You now owe over $14,000 on a card with a $100 credit limit.

I know. I just don't understand why they get to drop the credit limit by $21,900 when the account is closed. And I wish I could just pay it off but unfortunately $14,000 is not so easy to come by lately lol The monthly payment on this card is bad enough it would be REALLY hard for me to allocate any more to it without effecting my ability to pay off other bills

Anonymous · ‎04-19-2009

I don't see how they can CLD after the account is closed.

And, what would be the point? The account is closed.

I would send a letter(not dispute) requesting 3 things from the OC. I wouldn't even make it remotely appear to be a dispute.

1) Current Balance

2) Highest Previous Balance

3) Credit Limit on the account.

Is this beyond SOL?

Anonymous · ‎04-19-2009

JBoswell wrote:
So it's not really a resolution at all. What was the point then in them updating the description to say "Amount in H/C Column is credit limit"? <<< That is something your report/the CRA tells you, I don't think the creditor adds that comment, but I could be wrong. Why not have just left it alone if it makes no difference. lol. Yesterday I also got a mail response to the letter I had sent them in which they said "the high balance reported is accurate based on our investigations and we have enclosed a copy of your previous bill for validation" --- which, yea, the high balance is accurate, but that wasn't even remotely when I was disputing. I disputed the credit limit. But in all of my correspondence to them they ignore my requests for fixing that and just "validate" some other random information that I wasn't even inquiring about. @)(#*)!@*#%@#%^!@ it's just getting so frustraiting.
The dispute actually helped my score, Utl. changed from the 329842074108410948% to "not reported" so I guess my score will drop again when resolved. I probably should have waited to get the reports until AFTER it was resolved because I've also had several collections removed and now I have no idea what my actual (not dispute confused) credit score is.
and to the other response...

You now owe over $14,000 on a card with a $100 credit limit.

I know. I just don't understand why they get to drop the credit limit by $21,900 when the account is closed. And I wish I could just pay it off but unfortunately $14,000 is not so easy to come by lately lol The monthly payment on this card is bad enough it would be REALLY hard for me to allocate any more to it without effecting my ability to pay off other bills

Anonymous · ‎04-19-2009

If they aren't going to display the CL at the time of closure, you'd be better off having a $0 CL displayed and just the highest past balance reported correctly.

Anonymous · ‎04-19-2009

@JBoswell wrote:

and to the other response...

You now owe over $14,000 on a card with a $100 credit limit.

I know. I just don't understand why they get to drop the credit limit by $21,900 when the account is closed. And I wish I could just pay it off but unfortunately $14,000 is not so easy to come by lately lol The monthly payment on this card is bad enough it would be REALLY hard for me to allocate any more to it without effecting my ability to pay off other bills

@ Sidewinder wrote:

I don't see how they can CLD after the account is closed.

And, what would be the point? The account is closed.

I would send a letter(not dispute) requesting 3 things from the OC. I wouldn't even make it remotely appear

to be a dispute.

______________________________________________________________________________________________

I'm pretty sure that any closed account normally reports as 0 credit limit. At least the only ones I've ever seen did. I was a little surprised they showed her with $100 limit.

Sidewinder, I believe the point as far as the credit card company is concerned is to encourage the creditor to hurry up and pay the balannce off.

You NEVER want to have an account closed with any balance on it at all.

JBoswell, I understand that $14,000 is an awful lot of money, now or at any time. But I don't believe you will see your scores rise a great deal until these accounts are paid down/off. You asked if you should put extra money toward this account or pay off other accounts. In .my opinion you need to put anything extra toward this closed account

Message Edited by VEEnVEGAS on 04-19-2009 12:44 PM

Anonymous · ‎04-19-2009

Many closed accounts report the CL at the time of closing.

The spouse has a CC that the creditor closed without notice, while it had a balance on it. The CL is still being reported and the account is affecting utilization just like it did when it was open.

In the case of the OP, if the CL showed $0 or the correct CL, it would help much more.

With the current CL being reported as $100, with a balance of $14,000, util is 14000%(I think)

With the CL reported as $0, FICO uses largest past balance, which is reported as $18,000, so util would be 78%.

With the correct CL of $22,000 being reported, util would be 64%.

Big differences there, especially when you are talking about being >100% util and <100% util.

Anonymous · ‎04-20-2009

Credit limit on a closed account does not factor into utilization. The balance still does. Really doesn't matter whether they gave gave her husband notice that the card was being closed.

Yes, they are at over 14000% utilization on this card.

Message Edited by VEEnVEGAS on 04-20-2009 02:58 AM

JBoswell · ‎04-20-2009

I don't see how they can CLD after the account is closed.
And, what would be the point? The account is closed.

I would send a letter(not dispute) requesting 3 things from the OC. I wouldn't even make it remotely appear to be a dispute.

1) Current Balance
2) Highest Previous Balance
3) Credit Limit on the account.

Is this beyond SOL?

I have no idea, when the account was closed it was quite a process. I had missed three months payments back in '04 when I got out of college and was looking for a job, they called and said they were closing the account and that if I didn't pay the entire past due balance within the week they would sue me etc etc. So I took everything I had in savings and threw it at the card. They said that as long as I made payments in July - Sept. on time my account would come out of "negitive status" with them, and they'd no longer report me as being 90 days late on the account. So I did, and they did. But for some reason, when we came to this agreement they began reporting the card different, instead of saying "opened in 6/04" in said "opened in 6/06" and instead of the "$22,000 limit" it had before it reported with "$100 limit". I tried calling - at first just to try and understand why and nobody I talked to seemed to have a clue or the ability to fix it.

As for what to ask them for, that is what i tried to do, and they responded by sending me an old bill - the bills also now say that the credit limit is $100 and their letter only acknowledged that I was asking about the high balance, which I wasn't, because it wasn't wrong.

As for the "SOL" I really thought that only referred to collections account or accounts that you aren't in good standing with so I dont know, I've been paying the card on time, have no past due balance, whether or not they can sue me I'm not sure, I don't think they would though unless I fell behind again.

If they aren't going to display the CL at the time of closure, you'd be better off having a $0 CL displayed and just the highest past balance reported correctly.

The highest past balance is reporting correctly, but they are and have been reporting a credit limit, so I don't really know how to get them to fix it.

JBoswell, I understand that $14,000 is an awful lot of money, now or at any time. But I don't believe you will see your scores rise a great deal until these accounts are paid down/off. You asked if you should put extra money toward this account or pay off other accounts. In .my opinion you need to put anything extra toward this closed account

I had, but I had actually asked in reference to two of my husband's cards because I had thought paying them off to $0 (which we can do) would be better than paying chase off $3,000 and having it still not even be close to $0, my question was more about that. We need *both* our credit scores in good shape to get a mortgage we have a limited amount of money I just wanted to know where it would be better used. Believe me if we have $14k instead of $3k I would LOVE to pay off chase, I just didn't think it would be the best allocution of the funds at this point. I later asked about the credit limit thing with chase, because everything started appearing strangely on my credit report after sending in a letter asking them what was going on.

Credit limit on a closed account does not factor into utilization. The balance still does. Really doesn't matter whether they gave gave her husband notice that the card was being closed.

... and now I'm confused. lol. does the credit limit factor in or no? I appreciate all the feedback, I'm just getting a little mixed up about it, I had to have a cup of coffee and look up about 12 abbreviations before I could even tackle responding.I guess ultimately, I had just wanted to know about paying off my husbands WAMU (Chase) Card and Citizens Bank CC and in what order and etc etc. As far as my own stuff I was really just trying to understand HOW the credit limit is being factored in and why the hell it dropped and what I can do about it and etc. It seems like you get a lot of different opinions on this. People have said the credit limit still counts, or it doen't or it's the high balance or it's 0 and my head popped and I now have no idea lol. If the credit limit DOES factor in, then I should obviously try to get it to report accurately, if it doesn't or if it reports as 0 or the high balance, then there probably isn't much of anything I can do besides continue to pay the monthly amount and keep the account in the "paid/pays as agreed" status until I can pay the whole thing off.

Anonymous · ‎04-20-2009

VEEnVEGAS wrote:
Credit limit on a closed account does not factor into utilization. The balance still does.

Credit limit DOES factor into utilization on closed accounts. It is happening with my spouse's closed account.

Message Edited by sidewinder on 04-20-2009 06:20 AM

Credit Utilization? - Another Question