I despise these people! I have a long standing Chase card that I paid off in full because they raised the interest to an absurd rate when I paid 1 payment late by a few days, which ocurred about 3 years ago. They cancelled it later, due to inactivity, which I know hurts my rating, even tho it was not due to any negative behavior on my part. After calling them multiple times, they agreed to reactivate the accout, just as it was. This was about 5- 6 months ago. Yesterday, I got another letter that they have cancelled it AGAIN, with a list of 3 possible excuses. I have not paid any cards late, I have not taken out new cards or assumed new loans, our car notes are diminishing. So there is really no legitimate reason for them to consider me higher risk than I was 5- 6 months ago. I believe the law still allows these scummy people to cancel cardholders at will, but how can they be allowed to hurt our credit rating when we have done nothing wrong. Other than ever being connected with Chase in the 1st place! Citibank loves me & keeps sending letters raising my limit with them. From what I hear, many timely payors are being ripped off by Chase in a similar manner. Could there be a Class Action Lawsuit initiated?
Sorry to hear about your card cancellation. Believe me, it's not just Chase. I had a Citibank card closed on me earlier this year for inactivity, and other major credit issuers are all doing the same thing. We can expect a lot more of it too, as they try to clean house in preparation for the new legislation taking effect next year. The bottom line is they can close accounts whenever they feel like it, and the new rules won't change that either. The ECOA doesn't even require notification if the account is closed due to inactivity or delinquency. If they use the "based on information in your credit report" excuse, you'll be lucky if you see a letter before the account is actually closed.
Creditors are closing accounts and slashing limits to the balance accross the board. While it negatively affects your FICO score, there is nothing that can be done about it. I've rolled around the idea of bringing forth an action for a few clients under the Tennessee Consumer Protection Act but, the law just isn't strong enough. Without some new legislation, we're just stuck with it.
