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@Anonymous-own-fico wrote:I was wondering in which ways a card account can be closed when the balance hasn't yet been fully paid down?
Also, it may be worth considering that not all cards, such as charge and NPSL, figure in utilization.
I have voluntarily closed accounts that have a balance when the bank notified me of an interest rate increase. Since I didn't need to use the cards anymore and didn't agree to the rate increase I just locked the interest rate down by closing it from any future use. And years ago when hubby and I had some financial problems, the bank closed an account for us. However we are still responsible for the balance!
@llecs wrote:OP, per FICO scoring, a closed CC with a balance and a reported CL are fully factored into utilization, not just the balance. It'll remain factored in for as long as the balance reports anything other than $0. Once it is paid off, then FICO will ignore both the balance and CL forever. In other words, that closed TL helps you quite a bit now. However, focus on paying down balances as you can't keep a balance on it forever.
Good info! Does that apply to AU accounts that show on reports as well?
@tisch0791 wrote:
@llecs wrote:OP, per FICO scoring, a closed CC with a balance and a reported CL are fully factored into utilization, not just the balance. It'll remain factored in for as long as the balance reports anything other than $0. Once it is paid off, then FICO will ignore both the balance and CL forever. In other words, that closed TL helps you quite a bit now. However, focus on paying down balances as you can't keep a balance on it forever.
Good info! Does that apply to AU accounts that show on reports as well?
Yes.
Could be. Check "Ratio of your revolving balances to your credit limits" under "Understanding Your FICO® Score" in a FICO score report and compare to your own utilization calculations.
Does a charge off credit card, credit limit count?
Closed CCs, including a CO'd CC, can still factor into your utilization provided it reports a balance other than $0 and provided it updated on your CR within the past year or so.