Closed Accounts

[Queenie17]

How are closed accounts viewed in terms of credit utilization since I have $0 available credit for 3 accounts?  I'm currently paying as agreed, but they were originally closed for late payments more than 3 years ago.

[MarineVietVet]

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@Queenie17 wrote:
How are closed accounts viewed in terms of credit utilization since I have $0 available credit for 3 accounts?  I'm currently paying as agreed, but they were originally closed for late payments more than 3 years ago.

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Hello and welcome to the forums.

Are you saying that none of the closed accounts has a CL? Do you have other credit cards? Do they have current balances?

If you don't mind posting all your account balances vs. credit limits it will be easier to see how this might be affecting you.

From a BK years ago to:
7/09 TU-742 EQ- 779
8/09 TU-765 EQ- 783
9/09 EX pulled by lender 802

You can do the same thing with hard work.

[Queenie17]

I just checked one of my credit reports and they report the limits, but the 3 accounts are listed as closed.  I have 9 other credit card accounts in good standing and a student loan account in good standing.  My scores are:  TU:  612; Equifax: 624, and Exp:  547.

Thanks.

[Jazzzy]

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@Queenie17 wrote:

I just checked one of my credit reports and they report the limits, but the 3 accounts are listed as closed.  I have 9 other credit card accounts in good standing and a student loan account in good standing.  My scores are:  TU:  612; Equifax: 624, and Exp:  547.

Thanks.

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Hi, and welcome. Did you get a credit report that also gives you your utilization percentage? If you pull from here at myFICO, I think they will give you your utilization percentage...and doing the math and comparing the numbers are about the only way to tell if those credit limits on your closed accounts are being counted in your utilization.

Also, where are you getting your scores? Are they true FICO scores? Or are they from a vendor who is selling "credit scores"? It's good to monitor your reports, but be careful when it comes to scores. You want to make sure they are FICOs, since that is what the lenders look at. There are a lot of different scores out there, but most of them don't tell you much.

[MarineVietVet]

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@Queenie17 wrote:

I just checked one of my credit reports and they report the limits, but the 3 accounts are listed as closed.  I have 9 other credit card accounts in good standing and a student loan account in good standing.  My scores are:  TU:  612; Equifax: 624, and Exp:  547.

Thanks.

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If you could post those all those numbers it would certainly help.

[Queenie17]

Thanks for your help.  Yes I got TU and EQ from myfico.com and the EX directly from Experian.

[Queenie17]

IT looks like the balances are included. My utilization is over 90% right now, but I'm paying them down so that my scores will go up.

[pizzadude]

It appears that for me at least, fico scoring DOES consider both balances and credit limits from open and closed accounts when calculating utilization.

ScorePower report from Jan19 shows ratio of revolving balances to credit limit 3%.

By my calculations if the CL from my closed account was ignored I would show 12% utilization.

Cards 1,2,3 are open

Card 4 is closed ( also an AU account ). 

Here are my numbers:

                                                Balance           CL ( shown on report )

card1                                       388                  2500

card2                                       133                  1000

card3                                       82                    1250

card4 ( auth user/closed )          2                      13000

util with all accnts          3.4%    605                  17750

util with open accnts      12.7%  603                  4750

[Lel]

If a closed account still has a balance AND a credit limit is still being reported, then it will be included in utilization.

If a closed account has a zero balance, then it will be removed from utilization.

If a closed account still has a balance BUT the credit limit is reported as $0, then the account is removed from utilization.

pizzadude, your illustration perfectly demonstrates how closed accounts with balances and credit limits are treated.  Once you send in a check for $2, your utilization is going to go up.

Queenie17, you mentioned your closed accounts (which have balances) are still reporting CLs.  This means that these accounts will still be included in utilization.  You also mention that you have $0 in available credit for these accounts.  I'm curious - have your CCs been dropping your CL as you pay down your balance?  That is, let's say that you have a closed, maxed-out card with a CL of $1000.  If you pay the balance down to $800, did your reported CL also drop to $800?  This is a practice called balance chasing, and it makes it hard for persons with closed CCs to improve their score, since paying down the closed account balance doesn't in as much of a decrease in utilization as would happen if the CL were left intact.

[Queenie17]

I checked all 3 reports and the CLs have not dropped, although I tried to get one of them reopened since I have been paying on time for 24 mos, but they said no. 

Thanks for your help.