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Anyone Ever Have A CC Company Close A Card For Inactivity?

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Anyone Ever Have A CC Company Close A Card For Inactivity?

Old 07-15-08, 04:21 PM
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Anyone Ever Have A CC Company Close A Card For Inactivity?

A couple of weeks ago I got a notice from Saks that they were closing my Saks 5th Ave Elite card due to inactivity. I've had it for a number of years and use it whenever I shop at their stores. I was a regular shopper until I went back to grad school, and now I only buy stuff a couple times a year from them. Evidently I wasn't using it enough for them, and they closed it. They told me I can keep my store account with them, but are closing the CC.

Has this happened to anyone? I am more annoyed than anything, as when I did use it I'd get some pretty good perks. (I got probably $150 in GCs last year because my "mystery coupons" were pretty good, I also got a good % off on a suit I bought, shoes, etc).
Old 07-15-08, 04:27 PM
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I've never heard of that......in fact they shouldn't.....Once they close the card, it "erases" all the good credit you've built up through using it and (hopefully) making on time payments...My accountant tells me and my folks not to close any credit cards whatsoever, just stop using them, which means they don't cancel for inactivity...I've only heard that on bank/checking/stock accounts.
Old 07-15-08, 04:55 PM
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I had a Sears card closed and a Chase card closed. I only used the Chase one for a balance transfer then never used it again. Never did use the Sears card.
Old 07-15-08, 05:04 PM
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I've heard that this is happening more frequently, as the cost of keeping the account open is not zero, and you're basically giving them little to no business.

I think there was a thread here recently where people were reporting something even worse: credit card companies closing cards because the balance was paid in full every month.

I am surprised that they told you they were going to close the card outright... I wonder why they don't just give you some grace period for you to go charge something.
Old 07-15-08, 05:05 PM
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Originally Posted by paulringodaman
I've never heard of that....
It costs them money to have an account open, in addition to the fact that it extends their potential liability. I wouldn't be surprised to see a lot of banks close inactive accounts in the next few years for that reason.

As to whether they can do it, I don't see why not. They should have the right to discontinue offering you a service if you cost them more money than they make off your account.
Old 07-15-08, 05:09 PM
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Originally Posted by fujishig
I think there was a thread here recently where people were reporting something even worse: credit card companies closing cards because the balance was paid in full every month.
I've been dreading that day. Hopefully AMEX makes enough on merchant fees and annual fees to prevent them from starting that practice.
Old 07-15-08, 05:11 PM
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I had one closed for non-activity. Don't remember a notice, though. I called to cancel for non-activity and they said it was already done.
Old 07-15-08, 05:13 PM
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It doesn't make sense for the big companies like AMEX to do that. They'd lose a whole lot of customers including me if they did that and that doesn't include the merchant fees they would be losing.
Old 07-15-08, 05:14 PM
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Yeah, HSBC did that to me earlier this year. I couldn't care less, they actually saved me the hassle of closing it myself.

If a card I had for a long time (>10 years) did it, I wouldn't be happy, but if I'm not using it, it might as well be closed.
Old 07-15-08, 05:29 PM
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I had a bunch of department store cards (Sears, Wards, JCPenney) closed for inactivity. I think it was after 18 months (and a zero balance) they close them. I didn't care, I never used them anyway. I only got them when I was new to credit cards 20 years ago and thought it would be cool to have a bunch of them.
Old 07-15-08, 06:17 PM
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Originally Posted by big whoppa
It doesn't make sense for the big companies like AMEX to do that. They'd lose a whole lot of customers including me if they did that and that doesn't include the merchant fees they would be losing.
If your account costs them more than they make, they'll close it. I'm just hoping that AMEX's higher merchant fees will prevent this from being an issue, ever (I know a few small businesses that give me a hard time whenever I pull out my AMEX because the merchant fees are so high -- of course, if they didn't take it, they wouldn't get my business, period, but they don't mention that when they complain).
Old 07-15-08, 06:31 PM
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Originally Posted by Quatermass
I had a bunch of department store cards (Sears, Wards, JCPenney) closed for inactivity. I think it was after 18 months (and a zero balance) they close them. I didn't care, I never used them anyway. I only got them when I was new to credit cards 20 years ago and thought it would be cool to have a bunch of them.
It's probably been 8-10 months since I've used it....which doesn't seem that long. Eh, whatever.
Old 07-15-08, 07:20 PM
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I think they peg the reason for closure on your credit report. Of course, each credit company makes up their own rules as to what's good.
I had one closed less than one month after paying it off (after running a balance for years, quite often with overlimit fees or late fees). F*$* Crapital one.
I could see getting pissed if it had a long, good history--but the history is still accessible/visible, isn't it?
Old 07-15-08, 08:10 PM
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hsbc is big on this. they do it for almost any store branded cards(best buy, carsons, etc). 6 months of no activity and it's gone.
Old 07-15-08, 09:03 PM
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Originally Posted by amd555
hsbc is big on this. they do it for almost any store branded cards(best buy, carsons, etc). 6 months of no activity and it's gone.
I just had HSBC close a Mastercard on me for inactivity. No biggie - one less temptation.
Old 07-15-08, 09:07 PM
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I dont use credit cards but i will eventually get one to build credit. Now this thread will be a reminder to just spend $5 a year on the card to keep it active
Old 07-15-08, 10:19 PM
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Except that one of the things that can affect your credit score is balance-to-limits....and closing a 0-balance card can make that percentage increase. Of course, they don't like seeing a huge available limit either. Either way, it's their game.
Old 07-16-08, 02:00 AM
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Originally Posted by paulringodaman
I've never heard of that......in fact they shouldn't.....Once they close the card, it "erases" all the good credit you've built up through using it and (hopefully) making on time payments...My accountant tells me and my folks not to close any credit cards whatsoever, just stop using them, which means they don't cancel for inactivity...I've only heard that on bank/checking/stock accounts.
Not totally true.....The history will remain for up to 7 years and then "fall off"....It will jsut show as a "closed account". The "ding" is that its will probably show up as closed by credit granter, instead of closed by client. The 1st one is "worse" then the latter.

BTW redit card companies can and often do close accounts for inactivity. Each company has its own set of rules as to what the "limit" is. The best policy is to take those "sock drawer" cards out every once in a while for a small purchase, pay it off and put it back. This way you keep it "active", without going crazy with it.

As I said before though, the good history of the card remains on your credit report, the bad thing is that the overall utilization on your CR will change (it will go up) which could, depending on the rest of your limits\balances have an adverse effect on your Credit Score.
Old 07-16-08, 09:14 AM
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Yea, I can't find the article now, but I think it was MSNBC that had one in the spring that talked about how credit card companies are terminating cards that don't make them money. The two they focused on were 1. Those people who pay their balance in full every month and 2. Those people who don't use the card at all.

This was around the same time they had all the news about card companies changing interest rates on people, shortening the time you have to pay to 10 days each month before it's considered late, etc.

I think Capital One was highlighted as one of the offenders of all of these. I remember they said if you don't have the payment to their office by noon or something on the day it's due, it's considered late.
Old 07-16-08, 09:20 AM
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I've had this happen. It didn't adversely affect my credit, whereas had I closed the card myself it would have.
Old 07-16-08, 09:21 AM
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No but then again I have no department store credit cards
Old 07-16-08, 09:34 AM
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I had a CC closed on me for inactivity. I think it may have been around 9-10 months and was it always paid off each month in full when I did use it.

I actually found out on vacation when the card was rejected.
Thankfully I had another one that I use all the time now.
Old 07-16-08, 09:39 AM
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Originally Posted by mbs
Yeah, HSBC did that to me earlier this year. I couldn't care less, they actually saved me the hassle of closing it myself.

If a card I had for a long time (>10 years) did it, I wouldn't be happy, but if I'm not using it, it might as well be closed.
I had HSBC close one of mine last year, but I only had the card for a year. I used a promotional 0% balance transfer if I opened up the account, paid it off after a few months, and not even 6 months later they sent me a letter telling me they closed the account. I don't think I even called the number on the sticker on the card to activate it.

Chase, however, didn't seem to want to close an account of ours. We no longer had the card as it had expired and we cut it up. We called b/c we never received a new one. We had moved and already sent in a change of address notification. We called, they said they cannot cancel w/o verifying the 3-digit security code on the back. We said we didn't have the card, and we couldn't. They said they would send the card to us, but they had our old address on there even though we had gotten mail (promotional checks) at our new address. However we couldn't change our address w/o the security code. The only option, according to them, was to have them send the card to our old address, hope the USPS still forwarded the mail, and call them back w/ the security code. It had already been more than a year since we moved, and we weren't going to let a card sent to someone else on purpose. So we sent in a letter to the address on a previous statement demanding they cancel the account, and the next month we got a letter (at our new address) confirming they cancelled the account.

Last edited by GradVT06; 07-16-08 at 09:45 AM.
Old 07-16-08, 10:02 AM
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Originally Posted by GradVT06
However we couldn't change our address w/o the security code.
That's strange. Do they have a website where you can log in and "manage your account", including changing the address? That's how I've always done it.

A letter seems like the least secure way to handle something like this (how do they know it's you? I've had banks keep my signature on file, but never a CC company).
Old 07-16-08, 11:14 AM
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yes, one or two, but it was quite a while ago.

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