HSBC-Closed Account for non-use

[Anonymous]

This makes me so angry. I had a HSBC credit card - paid off the balance in April. Havent used it as I am working on paying off credit cards. I have never paid late, never paid below the min, excellent history with them. I get a letter today and they closed my account because I have not used it and they cannot reactivate it. The only way to get the account open is to reapply for a new card. Riduculous. I told the CSR that was not acceptable because they were going to lower my credit score. It messes up my utilization percentage, it was one of my older cards with history, and it was closed by them - not by me. By applying for a new card, it looks like I am trying to get more credit, will have a card with no history, etc. I just cannot believe that HSBC would do that - you get punished for being responsible. Needless to say, I threw a fit - and now they are going to look at my account to see if they can do a manual reactivation (whatever that means) but I wont be surprised if I get a denial letter in 5-7 days. The CSR did make a note that I was saving the card for emergencies and that is why I wasnt using it. I could surely spend 10 bucks a month on it and pay it off. If I would have realized this, I would have used it for small things. Now, I am worried about my other cards (3 dept store, I credit card) that have zero balances. Do you really have to use your card each month or every other month so that the company doesnt cancel it?  Is there anyway to prevent this?

[mjbfan79]

How long did you go without using you card?

[voidman]

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@mjbfan79 wrote:

How long did you go without using you card?

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Well he said that he paid off the balance in april not sure if its april'08 or '07.

If it was '07 then it makes sense, if '08 then it does not make sense.

[Anonymous]

I have heard that HSBC is a bit touchier than other CC's. I use mine at a minimum of every other month. And it is the only card that I will allow to post a balance at statement time, because then I get the activity of in month 1 a purchase, month 2 a payment, and then month 3 a purchase and so on.

Someone said, and it looks like it happened for you, that on the third month of no activity HSCB will close your account.

However I had a BoA card that I didn't use for over a year without a problem.

But since I now know about CCs closing for inactivity, all of my cards get used about every other month.

I am also paying of my CC's, so instead of using the cards for stuff I don't need, I just use them for purchases I would already make. Gas, groceries, getting my haircut, etc, and then I immediately pay them off.

Good luck with HSBC.

[haulingthescoreup]

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@Anonymous wrote:

This makes me so angry. I had a HSBC credit card - paid off the balance in April. Havent used it as I am working on paying off credit cards. I have never paid late, never paid below the min, excellent history with them. I get a letter today and they closed my account because I have not used it and they cannot reactivate it. The only way to get the account open is to reapply for a new card. Riduculous. I told the CSR that was not acceptable because they were going to lower my credit score. It messes up my utilization percentage, it was one of my older cards with history, and it was closed by them - not by me. By applying for a new card, it looks like I am trying to get more credit, will have a card with no history, etc. I just cannot believe that HSBC would do that - you get punished for being responsible. Needless to say, I threw a fit - and now they are going to look at my account to see if they can do a manual reactivation (whatever that means) but I wont be surprised if I get a denial letter in 5-7 days. The CSR did make a note that I was saving the card for emergencies and that is why I wasnt using it. I could surely spend 10 bucks a month on it and pay it off. If I would have realized this, I would have used it for small things. Now, I am worried about my other cards (3 dept store, I credit card) that have zero balances. Do you really have to use your card each month or every other month so that the company doesnt cancel it? Is there anyway to prevent this?

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Welcome to the forums, and I'm sorry it was under such exasperating circumstances!

HSBC has become infamous for this twitchiness. If they give it back to you, look for a small recurring bill that you can put on it each month, especially one that you would be paying anyway (water bill, charity, newspaper subscription, etc.)

For your other cards, speaking in general, you can let department cards ride a while. Once every six months to a year should keep them happy. For a credit card, at least once every three months is safer, and as you found with HSBC, even that might not be enough. You might want to call and ask them if they have some automatic shutdown after a certain interval.

I applaud those who keep their balances at $0. I do, too. But I do use my cards for things that I would otherwise have paid cash for: gas, groceries, prescriptions, etc. I think of my CC's as really slow debit cards and pay them off frequently, as in several times a month. This seems to work out best all around, plus I'm getting my rewards from the cards.

It's getting to be a strange world out there in credit land, that's for sure. Good luck with HSBC, those stinkers.

[Anonymous]

Screw them anyway. I have one card that's backed by those devils and that's it. I have NO love for HSBC. That they would do that is no surprise.

[Anonymous]

Well, I have a Discover card that I haven't used in over 9 months. It has a zero balance. So I really dont understand why they cancelled your card?

[TangMeister]

They're canceling cards for inactivity due to profits and shrinking credit lines going on in the credit markets. It may not have hit their Discover Card line yet, but don't be surprised when it does. I know they're closing American Express cards for inactivity. I'd say you might want to use that card and SOON, if you want to keep it.

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@Anonymous wrote:

Well, I have a Discover card that I haven't used in over 9 months. It has a zero balance. So I really dont understand why they cancelled your card?

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[Anonymous]

HSBC put up a decent fight when I closed both of my accounts with them- 

I will never do business with them again nor recommend their products.

[haulingthescoreup]

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@Anonymous wrote:

HSBC put up a decent fight when I closed both of my accounts with them-

I will never do business with them again nor recommend their products.

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Well, that's fun. They'll go down kicking and screaming if YOU try to close them, but they'll close a consumer without blinking an eye.

They are one strange bank, that's for sure.

gilbert22, you might see if there is some ongoing bill --utilities, cable, phone, charity, etc --that you can put on your Discover. If you can automate it, you don't even have to carry the card with you. That will keep the account alive, but it won't involve much work on your part, other than to pay Discover (instead of the power company, etc.) each month.

When a lender shuts you down like that, you immediately lose the advantage of that card's credit line in your overall available credit, so your total util might rise, and in ten years when that closed account falls off your credit reports, you also lose all its history. They also might report it as "closed by creditor", which doesn't affect your scores, but might make another lender wonder what was going on.

Hope everyone goes back and takes another look at the Credit Card Holders Bill of Rights and provides some feedback to their representatives in Washington. Right now, all the power appears to be in the hands of the banks:

Credit Cardholders Bill of Rights Proposed in House (WSJ article)

one-page summary

(I realize that this bill doesn't directly address card closing.)