I recently pulled my credit report and found out that a creditor had closed my credit card account some months back (December to be exact) although I had no idea because I rarely use the account and simply didn't think about checking on it still being opened. I sent the credit card company a certified return receipt letter prior to going away for a long period of time (military deployment) asking if I could pre-pay on my account while I was away in order not to be late on my payments. Before I could check to see if they had responded, I was sent away on detachment and had limited access to check on the account. After getting back I noticed they had applied the payment I sent to the company for a lump sum rather than using it as requested and I now had several months of late payments (non-payment) listed on my account. I later found out that when I placed the request to apply those payments, the company then decided to close my account at that time. My question now is can creditors still report an account that is closed with late payments?
Yes, accounts that are closed (and creditors are allowed to close accounts whenever they want) with late payments can continue to be reported to the credit bureaus. Once they charge it off and sell the debt to a collection agency, it will then report as a Charge Off with a 0 balance and the collection agency will report it as a collection as well.
