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AMEX cancelled credit card. Then, my credit score decreased by 63, and it showed up as settlement on credit report. I have always paid my bill on time, just usually the minimum amount. Its fine, but my most recent credit report showed a decrease by 63 points. Looking into this, the AMEX account is appearing as a settlement for the current card balance. Do I have any options here? Or what is my best course of action? Seems ridiculous to me seeing as I did not come to a settlement with Amex in the traditional sense of the word, but still. Any advice would be appreciated.
@Anonymous wrote:AMEX cancelled credit card. Then, my credit score decreased by 63, and it showed up as settlement on credit report. I have always paid my bill on time, just usually the minimum amount. Its fine, but my most recent credit report showed a decrease by 63 points. Looking into this, the AMEX account is appearing as a settlement for the current card balance. Do I have any options here? Or what is my best course of action? Seems ridiculous to me seeing as I did not come to a settlement with Amex in the traditional sense of the word, but still. Any advice would be appreciated.
Hello. Can you provide any more details?
Was the card in default?
What type of Amex card was this?
is the 63pts drop from a FICO score?
What do you mean, not a settlement in the traditional sense of the word?
The drop was on my FICO score, yes. The card was not in default, but they cancelled it randomly one day. I assume this is because I was over the credit line a few times and usually only paid the minimum ammount due. Nonetheless, on my credit report, it says settlement, which may hurt my score. Then, when my updated score came out, it was indeed hurt. By traditional settlement, I mean that I was not in contact with the creditor and coming to a settlement agreement for an outstanding balance on my card. Rather, they just cancelled it with a balance remaining, and marked it as a settlement on my report.
@Anonymous wrote:The drop was on my FICO score, yes. The card was not in default, but they cancelled it randomly one day. I assume this is because I was over the credit line a few times and usually only paid the minimum ammount due. Nonetheless, on my credit report, it says settlement, which may hurt my score. Then, when my updated score came out, it was indeed hurt. By traditional settlement, I mean that I was not in contact with the creditor and coming to a settlement agreement for an outstanding balance on my card. Rather, they just cancelled it with a balance remaining, and marked it as a settlement on my report.
Has this balance been paid off?
Not yet, but the account still shows minimum payments of the usual ammount as if it has not been cancelled. Should I pay it off immediately?
@Anonymous wrote:Not yet, but the account still shows minimum payments of the usual ammount as if it has not been cancelled. Should I pay it off immediately?
Hi and welcome to the forums
If you want those points back immediately, yes.
If you need to continue to make payments, you can do that too but points wont be back until it's paid off.
It's affecting your utilization because it was closed while maxed out.
Basically, your balance counts towards individual and aggregate utilization, but the limit is no longer included into calculations.
Ok great. Thanks for the help in clarifying. I probably wont be able to pay it back completely in a single payment, but should have it paid off within two months.
@Anonymous wrote:Ok great. Thanks for the help in clarifying. I probably wont be able to pay it back completely in a single payment, but should have it paid off within two months.
That's totally fine. Your finances come before scoring, so if it takes you a few months, so be it
Maintaining cash flow is by far more important. Utilization has no memory, so once you're done paying it off, your points will be back.
Just make sure you're not late now that account is not active, it's easy to forget when card is not being used.