Hello All - I am a newbie and have a "fair" score that I've been working on the last 5 months. Recently, AMEX cancelled my card. I've had this card since January 09. My charges are usually in the 1200-1600 range each month. I usually pay on or before the due date. Sometimes I pay parts before the due date, just to bring the balance down. There was ONE instance where I paid half of the due amount 7 days prior the due date. The rest, I paid 6 days just after the due date. Of course, that was discussed with an AMEX agent, just to make sure that I did not appear to be delinquent borrower. Apparently, this is not good enough. AMEX cancelled my card four days ago. Their reasoning for the cancellation were: - Payment history - Credit report from Experian I honestly thought that I was on the right track. I paid AMEX (and other cards) on time (except for that one time - 6 days after AMEX due date). I'm also minding the debt/credit ratio healthy as well as keeping my inquiries low. So to have a CC company cancel a card, is like someone breaking up with you over text or email... not a good feeling. The AMEX agent I spoke with can only say "They cancelled your account due to your payment history and your credit report, ma'm" I though to myself... aren't my payment history okay. I know that there hasn't been anything different on my Experian report, since I first opened the AMEX account. So I am sad and confused. Should I attempt to reapply? or Should I ask to be reinstated, when clearly they closed it due to my history? Sometimes it feel so defeating. Has anyone experienced this? If so, what did you do, after pulling your hair that is... hehe Any directions on how to handle this would be much appreciated. Again, I am a newbie and eager to learn. Best, =)P
Get a copy of your report directly from Experian. Since you were cancelled, that's like being denied credit and you can get a report free. There may be something there that you don't know about.
Thanks for the quick response, Hedwig! Follow up questions: -Will being cancelled by AMEX be a negative entry on my report and lowering my score? -Should I bother reinstating my account, as offered by one of the AMEX agent (for a fee of $25)? Best, =)P
It depends on the rest of your report how much it will hurt you. If it changes the length of history (it was one of your oldest accounts) or your utilization ratio, it may have a big impact. Otherwise, it may or may not. Do you know what your score was before the card was cancelled, so you can compare it to the current score and see the difference?
I have read that a number of credit card companies (AmEx included) are canceling their high-risk and low-profit customers. The high-risk models I can understand, but they're also cutting off customers who pay their bills in full each month. Why? Simple; without any late fees or interest, the credit card company isn't making any money on the deal.
I've heard this, too, but they do at least make money off each transaction from the retailer. Amex never has interest on their traditional lines of credit because you must pay in full each month, but they do have the highest "discount" (the percentage of each transaction paid by the retailer) of all the major credit card companies. Still, the upshot of this development is that people who pay off each month are going to essentially be punished for being wise and prudent. This is what happens when you create an economy based on the accumulation of debt. Without the American consumer carrying substantial amounts of debt, these guys go out of business.
Thank you for the feed back, all!! AMEX pulled my credit again. Though nothing had changed since then, they now deemed my credit "poor" Here are some follow up questions: - Will this account closure by creditor, with no late payment, have a negative impact - lower my score? - Should I bother requesting a account reinstatement, with a groveling letter? - to ensure that i don't lower my score? Thank you again for all your help. Best, =) P
Yeah, it doesn't seem to make sense with the regular AMEX card, does it? I think the main cause of this is simply so much less credit/money to go around, so much less that both good and bad accounts are being terminated. I've read other stories exactly like yours. I know the limits on all my cards have gone down even if I haven't been terminated in any of them. They obviously cannot terminate accounts with outstanding balances (though they can reduce limits down to just above your outstanding balance.) And the credit crunch is now so bad that there are good customer accounts with no balances that are being cancelled. Things seemed unreal just last year, I remember talking to my CC representative to transfer some balances and he was practically begging me to take a larger cash advance than I really needed- not malicously or anything, there was no ill intent IMO- it was just a sign of the times. Money was practically free because there was no cost to borrow it, from the top down. I was also getting trees worth of cash advance checks with great promotional rates every week. Now I can't get a single balance transfer offer anywhere, everyone is holding tight to money.
