Bank autocancelled my cc - should I drop the bank?

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radiowave
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Bank autocancelled my cc - should I drop the bank?

Post by radiowave »

I had a non-rewards credit card at BoA for almost 20 years, mostly kept it for the credit history. Well BoA auto just cancelled that card due to lack of activity and won't reinstate it.

1. will that ding my perfect credit score?
2. Should I just drop BoA and use another local bank (closest BoA branch is 30 min drive). If I do that, will it affect my credit score?

tnx
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GMT-8
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Re: Bank autocancelled my cc - should I drop the bank?

Post by GMT-8 »

Anyone looking at your credit history will see the account was inactive anyway, and its cancellation. Don't worry about it.
Use whatever card suits you - as long as you pay the bill on time.

I had Citibank AAdvantage Visa and American Airlines switched to Mastercard.
I called Citibank and said can I get a new Visa, I don't want Mastercard and lower limits?
They said "Sure! Costco dumped American Express and moved to us. You can have a Costco Citibank Visa, same credit and cash limits."
I did it and there was no noticeable change to my 815-850 score.

Credit scores fluctuate over time anyway as they add and subtract mystery factors and the economy changes.

There's no need to use the card issued by your local bank unless you want to.
retiredjg
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Re: Bank autocancelled my cc - should I drop the bank?

Post by retiredjg »

Closing a card will change your score if it was a big portion of your unused credit. Or it may change it very little if you have a good deal of credit on other cards.

The closed card stays on your credit report for awhile. Losing your oldest card may not hurt you at all.

I would not let a card determine where I bank.
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arcticpineapplecorp.
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Re: Bank autocancelled my cc - should I drop the bank?

Post by arcticpineapplecorp. »

make sure to use whatever CCs you have once or twice a year to avoid being dropped due to inactivity. doesn't have to be a large purchase, can be micro, but should be used.

that being said, there have been companies recently closing accts for low usage because of the financial/economic situation. the banks don't want to be holding the bag if lots of people start borrowing to stay afloat. so they're trying to be prudent and not have as much credit out there as they'd want to have when times are more flush.
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
Fallible
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Re: Bank autocancelled my cc - should I drop the bank?

Post by Fallible »

Did the bank let you know earlier in some way that your card might be canceled due to inactivity?
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BolderBoy
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Re: Bank autocancelled my cc - should I drop the bank?

Post by BolderBoy »

radiowave wrote: Fri Jul 24, 2020 12:19 pm I had a non-rewards credit card at BoA for almost 20 years, mostly kept it for the credit history. Well BoA auto just cancelled that card due to lack of activity and won't reinstate it.

1. will that ding my perfect credit score?
Slightly and temporarily.

Amex cancelled my unused-for-15-years "Blue Advantage" card several months ago. My credit score went down 2 points for 1 month.
"Never underestimate one's capacity to overestimate one's abilities" - The Dunning-Kruger Effect
sport
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Re: Bank autocancelled my cc - should I drop the bank?

Post by sport »

My understanding is that it is not a good idea to have your credit card in the same bank you use for checking/saving. The reason is that credit card "terms and conditions" generally contain a clause that lets the bank raid your bank accounts if you do not pay what the bank thinks you should pay on the credit card. This could come into play if you had a dispute on the credit card and the bank refused to honor your legitimate claim. So, in this eventuality, if you refused to pay an unjust charge, they could just go into your accounts and take the money. Of course, if you do not have an account at the credit card bank, they could not do this.
Fclevz
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Re: Bank autocancelled my cc - should I drop the bank?

Post by Fclevz »

GMT-8 wrote: Fri Jul 24, 2020 12:25 pm ...I had Citibank AAdvantage Visa and American Airlines switched to Mastercard.
I called Citibank and said can I get a new Visa, I don't want Mastercard...
Just out of curiosity, why the preference for Visa over MasterCard? I've always assumed they were basically identical, or am I missing something? I currently have one of each.
jjhk121
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Re: Bank autocancelled my cc - should I drop the bank?

Post by jjhk121 »

BofA just did the same to me a few weeks ago. They closed my Cash Rewards Visa which I hadn't used in 2 years. I noticed it wasn't listed under my accounts anymore when I logged into the website so I had a feeling they closed it. I called just to make sure and the person I spoke with verified that they closed it and offered me a $100 credit after spending $1500 on my other BofA credit card. I happily accepted.
02nz
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Re: Bank autocancelled my cc - should I drop the bank?

Post by 02nz »

radiowave wrote: Fri Jul 24, 2020 12:19 pm 1. will that ding my perfect credit score?
Why do you care? There's no difference (in terms of the interest rate you get on a loan) between a FICO score of 850 and 840. Or even in most cases 850 and 750. People are WAY too obsessed with small and temporary changes in their credit scores. Some seem to think it's a measure of your financial well-being or some such thing. It's not.
02nz
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Re: Bank autocancelled my cc - should I drop the bank?

Post by 02nz »

radiowave wrote: Fri Jul 24, 2020 12:19 pm I had a non-rewards credit card at BoA for almost 20 years, mostly kept it for the credit history. Well BoA auto just cancelled that card due to lack of activity and won't reinstate it.

1. will that ding my perfect credit score?
2. Should I just drop BoA and use another local bank (closest BoA branch is 30 min drive). If I do that, will it affect my credit score?

tnx
Why are you so focused on your credit score? There's no difference (in terms of the interest rate you get on a loan) between a FICO score of 850 and 840. Or even in most cases 850 and 750. People are WAY too obsessed with small and temporary changes in their credit scores. Some seem to think it's a measure of your financial well-being or some such thing. It's not.
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FrugalInvestor
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Re: Bank autocancelled my cc - should I drop the bank?

Post by FrugalInvestor »

Apparently this is a common occurrence since Covid has raised its ugly head....

https://money.yahoo.com/banks-close-cre ... 39834.html

From article:
As the economic fallout of the pandemic continues to unfold, banks are rushing to close credit card accounts or slash credit limits to curb their risk. One in 4 Americans with credit cards said they had an account involuntarily shut down from mid-May to mid-July, while 1 in 3 said their credit limit was reduced, according to a new report from CompareCards.com that surveyed 1,003 credit cardholders.
Have a plan, stay the course and simplify, but most importantly....Ignore the Noise!
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radiowave
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Re: Bank autocancelled my cc - should I drop the bank?

Post by radiowave »

Fallible wrote: Fri Jul 24, 2020 1:24 pm Did the bank let you know earlier in some way that your card might be canceled due to inactivity?
No, that's what is annoying. I would have made some small purchases if I had a head's up about inactivity.
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stan1
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Re: Bank autocancelled my cc - should I drop the bank?

Post by stan1 »

You were fired as a customer for not making them any money and for being a potential liability if you were to suddenly start using the card due to a job loss. I'd just move on to something better.
snailderby
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Re: Bank autocancelled my cc - should I drop the bank?

Post by snailderby »

BolderBoy wrote: Fri Jul 24, 2020 1:28 pm
radiowave wrote: Fri Jul 24, 2020 12:19 pm I had a non-rewards credit card at BoA for almost 20 years, mostly kept it for the credit history. Well BoA auto just cancelled that card due to lack of activity and won't reinstate it.

1. will that ding my perfect credit score?
Slightly and temporarily.

Amex cancelled my unused-for-15-years "Blue Advantage" card several months ago. My credit score went down 2 points for 1 month.
What a tragedy. I hope you can recover from that loss.
sd323232
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Re: Bank autocancelled my cc - should I drop the bank?

Post by sd323232 »

radiowave wrote: Fri Jul 24, 2020 12:19 pm I had a non-rewards credit card at BoA for almost 20 years, mostly kept it for the credit history. Well BoA auto just cancelled that card due to lack of activity and won't reinstate it.

1. will that ding my perfect credit score?
2. Should I just drop BoA and use another local bank (closest BoA branch is 30 min drive). If I do that, will it affect my credit score?

tnx
Well, im sure the other bank is not any better.
lakpr
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Re: Bank autocancelled my cc - should I drop the bank?

Post by lakpr »

Fclevz wrote: Fri Jul 24, 2020 3:32 pm
GMT-8 wrote: Fri Jul 24, 2020 12:25 pm ...I had Citibank AAdvantage Visa and American Airlines switched to Mastercard.
I called Citibank and said can I get a new Visa, I don't want Mastercard...
Just out of curiosity, why the preference for Visa over MasterCard? I've always assumed they were basically identical, or am I missing something? I currently have one of each.
I am not the OP, but I prefer Visa over MasterCard too. Costco is my reason, we spend a lot there, but don't want pay annual fee for the Citi Costco Visa. Most benefits of that card can be obtained elsewhere
Topic Author
radiowave
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Re: Bank autocancelled my cc - should I drop the bank?

Post by radiowave »

Thanks for all the great feedback.
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Small Savanna
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Re: Bank autocancelled my cc - should I drop the bank?

Post by Small Savanna »

We still have an account at B of A. If it weren't for sheer inertia, I would definitely cancel it. They've just given you a good reason.
sport
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Re: Bank autocancelled my cc - should I drop the bank?

Post by sport »

lakpr wrote: Fri Jul 24, 2020 6:30 pm
Fclevz wrote: Fri Jul 24, 2020 3:32 pm
GMT-8 wrote: Fri Jul 24, 2020 12:25 pm ...I had Citibank AAdvantage Visa and American Airlines switched to Mastercard.
I called Citibank and said can I get a new Visa, I don't want Mastercard...
Just out of curiosity, why the preference for Visa over MasterCard? I've always assumed they were basically identical, or am I missing something? I currently have one of each.
I am not the OP, but I prefer Visa over MasterCard too. Costco is my reason, we spend a lot there, but don't want pay annual fee for the Citi Costco Visa. Most benefits of that card can be obtained elsewhere
There is no fee for the Costco Visa. They give you a rebate. It's 4% on gasoline, 3% on travel and dining, 2% at Costco, and 1% everywhere else.
GMT-8
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Re: Bank autocancelled my cc - should I drop the bank?

Post by GMT-8 »

I'm the one who posted about Visa vs Mastercard. It's to their advantage that we don't understand there is a difference. They are large financial companies who process credit transactions and charge merchants for that service. Visa is roughly 360 billion and MC around 300 billion capitalization.

You can bet when a large outfit with lots of clients switches -- like the American Airlines AAdvantage program from Visa to MC, that there was a financial reason behind it. Like dropping rental car coverage, eliminating "free" overseas purchases and adding a % fee on each purchase, etc.

And likewise, when Costco dropped the Amex card (they didn't use to take credit cards before then exc for Amex) you can bet they got a sweetheart deal from Visa.

Anyway, in some venues, say the Olympics, or in a resort, they might say "Visa is the Official Card of Roratunga" and a MC or Amex won't be accepted - just to flex their influence... Therefore I want to have one of each in my pocket, from a different bank or issuer, especially when I am traveling.

For example, on a business trip to Europe I went from Amsterdam to Bucharest, Romania then to England. Somewhere along the way my Visa card number got cloned and used to buy a tank of gas in Michigan. Visa froze the account. So when I arrived at the hotel in London my card was refused and banks were closed. My other bank card was ok but I was going to be in the hotel for a week at £500 a day. They wanted a couple thousand pound hold on the card which was more than my average spend. Luckily I could call Calif, talk to my credit union and get approval.

Having said all this I need to cancel a couple unused accounts now...

GMT
tivattom
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Re: Bank autocancelled my cc - should I drop the bank?

Post by tivattom »

Fifth Third just cancelled my 22 year old card with no warning. I had last used the card in December last year. So the card was not inactive for very long at all. They must be panicking. Good riddance to bad garbage, I'll just get something else.
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