Hello. I have been reading this forum for several years, but have not found a need to post until now. Basically MBNA closed all 4 of my MBNA credit cards w/ a combined credit limit of $20,000. Why? I asked for a Credit Limit increase on one of my cards. After they reviewed my Credit Report, they determined that it was risky to extend me ANY line of credit because I have(had) 20+ cards with a combined Credit Limit of over $100,000 based on my income. Although I called to complain and ask for a reconsideration, they are not willing to reopen the accounts. It is disappointing, but you win some and your lose some. My concnern is: Because the account was "closed by creditor" as opposed to "closed apoun request" will this have a negative impact on my Credit Score? All four accounts were less 1.5 years old, so their closure will actually increase the average age of my open accounts.
What was your actual outstanding debt? Based on similar reports, MBNA seems to operate on a hair trigger. Not a reliable financial partner, in my book. Choose partners who are more reliable. But test them when it doesn't matter.
I was using MBNA Billpay to pay other monthly credit cards. So my CC debt was around $10k. Although, I pay all my balances in full, have never made a late payment or been charged interest.
$10K debt out of $100K CL is not much, nor is it much different compared to $80K CL. Are there a lot of inquiries lately? Any negative TLs? What are your current FICO scores? Did you provide your current income as part of a recent application, and is it adequate to easily carry your debt? Are you a homeowner, as evidenced by a mortgage listing on your credit report? FICO might score you different with a longer history of CC debt paid as agreed, or a history of mortgage debt, paid as agreed. You would look more "stable", even with more total debt, since this population of debtors would probably pay more reliably than non-homeowners, and if you appear to be in the part of the homeowner population that is "paid as agreed", the reduction in your apparent risk would be magnified. On top of which you would likely have some equity, which is not directly visible, but assumable based on length of your mortgage. By comparison, if you're 2 years out of school, with a 3 year credit history, but $100K CL, you look like you have applied for a lot of potential debt, but there is not the history to know if you will use it and pay it off. With FICO, it appears you are attempting to estimate risk by comparing what is visible on an individual's CR with statistics on behavior of populations estimated to be "similar". It is NOT linear.
742 via Citibanks Credit Monitoring service last month. I am upset about it, but over it. I am just wondering if my Credit Report will say "closed by creditor" or something of the sorts as opposed to "closed by request" and if this will be detrimental to my Credit Score.
Since in effect, you have mutually agreed to part company with accounts that were paid as agreed, $0 balance, and in good standing, you might just ask them to mark the accounts "closed by consumer." In fact, you might just send them a "follow up" letter, requesting that. It's probably not worth it to them to argue. From some companies, you get the best treatment as a new customer, and are just taken for granted if you are an existing customer. Not an opportunity to expand a business relationship.
Have you verified that they did not close the accounts due to some recently posted negative TL of which you are not aware? Have you received an adverse action notice, indicating which credit reports they used in their decision? If not, request it. They must provide it in writing.
I called and the CSR today me that it will NOT say "closed by request" and it might say "closed by creditor" although she said that more than likely it will be left blank. She told me that a letter was sent out two days ago and I should get it in a few days. She also reitierated that my account was closed because of my available credit limit on all my cards ($120k) vs. my annual income ($50kish) posed a risk. Funny - since I have a great score and 9 years of credit histroy without a missed payment since my first credit card and student loan in 1996. I think that MBNA may start cracking down on people w/ genrous credit limits due to their merger with BOA.
It's their loss. That is why you must have diversification in credit relationships. Multiple accounts at one bank only brought you a riskier net credit line. It is strange that they would close all the accounts, and not just several, or just scale back the total. Only the market protects you from arbitrary acts. You may be right in guessing that after a bank merger or account purchase, the old accounts might be viewed as of higher risk, which they would want to minimize. Although if they are too stringent, what did they just pay for? Perhaps you might gradually readjust your portfolio of open accounts toward those with the best terms, gradually dropping those with less competitive terms as you add a few better ones. Ensure you don't have more than, say, 2 with any one bank. Did you provide annual income information with your request for a CL increase?
I had the same trouble with MBNA some years back. They closed one 20K perfect card for same reason. Only that i did not ask for an increase they raised it from time to time from 5k to 20k. What is funny is that another card i had from another bank is now issued from MBNA with also 20K limit. Regarding ur question if the "Closed by cr grantor" will affect u, no it wont. it really doesn't matter. But u should check if the account is ok. i mean it is say 0 balance and nothing negative.
my closed mbna account still say closed by creditor and it has not affected me or my scores at all. I also have had very good cards after this. Hope it helps
The notation closed by cr grantor could affect your FICO if your FICO scores are on the low side. FICO is a funky formula... people who struggle tend to be penalized more by the scoring system. The notation certainly won't help your scores though. This seems like a computer-driven action by MBNA. I would write the CEO and state your case there. Often, the executive office can make a personal judgment and overrule the systematic decision. Check the bbb.org for CEO contact information. good luck!
I have over 15 accounts reporting as "closed by creditor" reporting on my credit reports. All are paid in full and never had lates and they have not affected my credit score at all. In fact they may be increasing my score as they age. By the way MBNA is one of the few credit card issuers that pull the sh*t that you are going though. Try Citi and Chase for less of a hassle.
