Greedy Chase

[Anonymous]

I just received a notice from a credit card company stating that they are going to raise my interest rate because they are not making enough profit off of me.  I can choose to decline and continue to make payments at the current rate but they would close my account.  Does anyone know if my credit score will be affected by having a closed account with a balance remaining on it?

[Anonymous]

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bugeater wrote:
I just received a notice from a credit card company stating that they are going to raise my interest rate because they are not making enough profit off of me.  I can choose to decline and continue to make payments at the current rate but they would close my account.  Does anyone know if my credit score will be affected by having a closed account with a balance remaining on it?

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You will likely see an decrease because of util.

Do you have other revolving accounts? What is the util on those?

[Anonymous]

Yes, sidewinder, I do have other revolving accounts... too many.  But, my credit scores range from the high 600's to the low 700's and am trying to buy a home and don't want Chase screwing up my credit score.  The rate is going to raise from 7.24% to 12.99%.  Would it be better for my scores to accept the change?

[SCF]

Have you tried calling and asking them to reconsider?  You can use the backdoor numbers pinned at the top of this forum, it may not work, but it's worth a shot.

If that doesn't work, I would think about how much extra money this new interest rate will cost you, how quickly you can pay down this balance and whether or not you want to continue your relationship with Chase.  Depending on the financial cost, it may be worth it to accept the change, pay down your balance and wait out this market in the hope that Chase will decrease your APR again in the future.

Hope that helps, because it's not an easy decision but at least you're not alone!

[Cleanmachine]

APR's are not considered in determining your FICO Score.

[Anonymous]

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Cleanmachine wrote:
APR's are not considered in determining your FICO Score.

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No, but closed accounts with balances are.

[Anonymous]

Calculate your util with this account as is.

Then calculate your util without this available CL, but with the balance.

Example: You have 3 cards as follows:  100/1000, 0/1500, and 1200/2000(chase).

Util is 1300/4500 = 28%

Without the 2000 CL--

Util is 1300/2500 = 52%

As mentioned one option would be to pay the account off and leave it open with the higher APR and just don't use it.

Or if you can do a BT and leave it open, your overall util shouldn't change.

Message Edited by sidewinder on 01-21-2009 07:28 AM

[wmarat]

I got my Chase card 2 years ago with APR in 18%, now it is at 13.24%

PIF is our weapon against ratejack.