Credit card canceled without warning?
Has your credit card been canceled without warning or for no apparent reason?
The Associated Press is reporting that consumers across the country have been reporting such problems, specifically with bank MasterCards that are co-branded with oil companies.
Citibank confirmed the practice, AP reports. Citi said in a statement it “decided to close a limited number of oil partner co-branded MasterCard accounts.” That includes Shell, Citgo, ExxonMobil and Phillips 66-Conoco cards.
No law, AP said, prevents banks from closing down credit accounts without warning. Credit card issuers all maintain the right, typically listed in the fine print on credit card agreements.
Have you experienced this? Should the law be changed?
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140 comments Add your comment
BIOMASS
October 20th, 2009
9:01 pm
No, but I CAN’T WAIT to follow your every move on YOU’RATWIT! Gee, what will be the next Earth-shattering announcement?
Elliot
October 20th, 2009
9:13 pm
Just one more reason that my name for Citibank starts with the letters SH. Glad I don’t have any accounts with them, but Chase raised my rates for no reason as well. There’s a simple way to deal with that; pay your cards off every month.
ziti
October 20th, 2009
9:13 pm
Why are y’all still doing business with untrustworthy megabanks? A two-word suggestion: credit union. I’ve been with one for 15 years and get reasonable interest rates and great service. An example: My Visa Platinum Rewards card has a 9-1/2% interest rate. However, I haven’t paid a penny in interest because I pay the balance due in full every month — just what my Depression-era parents did with all their accounts. I’m thankful that they taught me to live within my means when I was young because that policy has paid big dividends over time. The peace of mind alone is priceless.
I also have a Citi MC/Sears Rewards card, used mainly for online store sales and no-interest big-ticket purchases, and a Costco AMEX card for warehouse buys and entertainment. Why? For backup (you just don’t know what’s going to happen), business and pleasure travel, a better FICO score, no annual fees and the cashback rewards programs. Their interest rates are waaay higher than the CU Visa, but since I pay the balance due in full every month I don’t care. I;ll care plenty if the no-fee and rewards programs change, but I’m betting that these retailers’ business contracts and affluent/huge customer bases are too important and profitable to mess with.
Life lessons: If you can’t buy and pay for it right then, walk away. Come back when you have the money. Always pay the balance due in full every month on every account. Read your credit card contract and related mailing. Keep 2-3 other credit cards in ready reserve in case one suddenly tanks a la Citi, at least until the volatile credit market calms down. If you need cash, use a debit card. Make sure you have enough in your account first, and that it can’t be overdrawn.
Fine Print
October 20th, 2009
10:05 pm
@ NARD – You need to stop reading fluff journalistic garbage and educate yourself. I repeat: A credit card company cancelling your card DOES NOT have ANY affect on your credit score.
You folks can listen to someone that has pristine credit or take advice from an idiot that calls itself NARD and posts links without regard to content. Your choice.
Brian
October 20th, 2009
10:15 pm
Citibank did this to me last week. I found out when I went to buy gas on Saturday and they declined it. I had the card three years. Never late and I always paid in full. I bought all my gas with it, so I used it every month.
When I called, they claimed they closed it because ’something’ Equifax supplied them. They would not say what, only that I’d get a letter with more information in 14 days. I know my Equifax report is clean, so I can’t wait to see the letter.
I have a Visa & and AMEX, and funny, neither of them closed my account.
They have every right to do it, but as I told them on Saturday, I will never again willingly do business with Citibank or buy another drop of Shell gasoline.
It’s a moronic decision on their part because now they’ve lost a customer for life. After I get their ‘explanation’ I’m going to explain that in writing to Citibank HQ, Shell HQ, both my local Shell stations and the Shell auto center that does my auto maintenance.
And as for those that are preaching about no credit, I travel a lot for business and no credit card is not feasible, so please step off the soapbox for a bit.
Brian.
Ray
October 20th, 2009
11:04 pm
Best thing would be to cancel all cards & make the applicants reapply with more stringent requirements.
End Usury
October 20th, 2009
11:15 pm
I agree with Bud Flu, Byron Dale’s videos on youtube are way better than this crap. Dave Ramsey is a fraud because he won’t touch how our monetary system really works.
His website is even better wealthmoney dot org
Rachel
October 21st, 2009
8:23 am
I would have no issue with banks cancelling credit cards just as consumers did if it did not harm the cardholder’s credit. Immoral credit scoring that denies honest people prime rates is what has to change.
Yeah right
October 21st, 2009
10:05 am
Smithy is right on this “If your card is cancelled payment IS NOT due in full immediately. No futher credit is extending, but the cc company still wants your interest!!!”
That’s why when Bank of America cancelled the overdraft protection I had for about 17 years (before they were “Bank of America”) I immediately paid off the entire amount IN FULL so they wouldn’t make that interest momey off me because that’s what it’s all about – the credit card companies making that interest money off of you without extending you the credit.
Now it’s a different story with an HSBC card I have … I paid on time but was cancelled without notice or warning. They already ruined my credit by doing that so if I don’t make that payment on time I don’t care anymore because the damage is already done. Probably not the best way to look at it but gotta do what I have to do these days and if a credit card company cancels my credit line without warning & ruins my credit score because of that, they are no longer the priority.
Saleem
October 21st, 2009
10:17 am
Exactly right Chris….history proves consistent once again!
Frank Fitton
October 21st, 2009
10:56 am
Its really ridiculous that the credit card companies can get away with this. They have 30 days to notify you that your card has been canceled. Anyone that uses their card even on a weekly basis, is going to have to find out about the cancellation at the register. That’s just an embarrassing, horrible situation.
I guess this is one of the controversial practices that the credit card companies employ, that fell through the cracks and was not addressed by the new laws. It’s just a shame.
Check out my blog about this horrible situation at http://www.thedebtgazette.com/2009/08/surprise-credit-cancelled/
AMEX Card
October 21st, 2009
11:41 am
AMEX didnt cancel my card. They just lowered by $8000 credit limit to $800. I was never late or missed a payment or anything. When I tried to re up the limit they just said “not at this time.”
Brad
October 21st, 2009
11:57 am
Jay-I got the same letter from Citi but I went from 9.99 to 29.99%. I was so mad that my knee-jerk reaction was to call the company and opt out. After I read up a bit I learned that it was not the right thing for me to do because of the effect that it would have on my credit score. I reopened the account and will pay off the small balance. This new bill that was passed allowed the credit card companies too much time. Now they are jacking up everyones interest rate before the law takes full affect. The whole law is punishing the same people that it was meant to protect. The most disturbing thing is that we gave billions to the banks in bail out money and this is how they show their gratitude!!!
Brad
October 21st, 2009
11:59 am
Jay-I got the same letter from Citi but I went from 9.99 to 29.99%. I was so mad that my knee-jerk reaction was to call the company and opt out. After I read up a bit I learned that it was not the right thing for me to do because of the effect that it would have on my credit score. I reopened the account and will pay off the small balance. This new bill that was passed allowed the credit card companies too much time. Now they are jacking up everyones interest rate before the law takes full affect. The whole law is punishing the same people that it was mean to protect. The ironic thing is that we gave billions to the banks in bail out money and this is how they show their gratitude!!!
Brad Gorr
October 21st, 2009
12:01 pm
I am wondering what all the banks that got “Stimulus money”are doing with “our governments”money?They are certainly not lending out as much as they have gotten.Maybe they are speculating and buying oil futures!After all where can you make more money now that our government has told us “things are getting better”.Also……another note of fact….for all those with low credit card interest rates…if you or the card company cancels your card the interest rate reverts to what they say they normally charge(20-25%)…check it out!You will find out I am right!
VLCS
October 21st, 2009
12:05 pm
Same story w CHASE!! Had the card for 10 yrs even when I originally got it w a $1500 limit during a divorce and struggling credit score and then they steadily raised the limit bc I was never late, never near or over the limit, and my credit score was in the 700’s. It went from Providian to Wamu and then to Chase and then BAM – my line was closed which hit my credit score losing $13000 line of credit!! So I will never use any CHASE products ever…of any kind even after the recession rights itself and they try to solicit my business bc for all of us that had this happen, they will down the line try to get us as customers again but they don’t know the definition of the word CUSTOMER. As Clark Howard says – FIRE companies that do you wrong and CHASE is definitely one of those companies!!!
Brad Gorr
October 21st, 2009
12:07 pm
In the previous comment I neglected to add the fact….for all those with low credit card interest rates who carry a balance on their cards…sorry.
catlady
October 21st, 2009
12:10 pm
Kevin, even without debt, your credit score is used for other things, such as your car insurance premium.
JEWELL ROLLEN
October 21st, 2009
12:17 pm
IM WITH STACE…THEY CANCELLED MINE BECAUSE I NEVER, EVER USED IT. I EVEN FORGOT I HAD IT. KEPT IT MY CAR FOR EMERGNCIES…NONE EVER CAME UP..TIL THEY CANCELLED IT!
Jane
October 21st, 2009
12:23 pm
My Master Card was canceled with out warning. The excuse was that I wasn’t using it, if they had given me a warning I would have used it.
Sarah
October 21st, 2009
12:25 pm
Credit card cancelled and found out about it as we were checking out. Always paid on time, never over the limit, but cancelled anyway.
Bill
October 21st, 2009
12:29 pm
Paid off and closed all of my credit card accounts last year. Now I just use cash, checks and my debit card for all purchases. My debit card is accepted any place that takes major credit cards since my debit card has a major credit card logo. I just have to make sure that I balance my checkbook every month since I have extra entries from debit card purchases but I have been doing this for years anyway.
A couple of accounting tips: I write “Bal OK” in my check register at the line where the previous balance checked out – if I have a problem with the next months balance I know I do not need to go to earlier line entries to find the discrepancy. I also keep debit card purchase receipts in my wallet in front of my cash as a reminder to make an entry into my check register later if I do not have my checkbook at the point of purchase.
My only debt as of May of this year is my mortgage and life has never been sweeter!
betty
October 21st, 2009
12:35 pm
Many time as in my case, my account was up to date, and I only owed BP $ 60 dollars, and they cancelled my account out. Much of the time, if you are not using your card, they feel they are wasting ther time each month with the process of what they have to do. We as the consumers get blamed for this showing on our credit report when we apply for something elese. That is not fair, this makes us look as if we are not paying our bills. I think the law should be changed, as far as consumers are concern. When the creditors look at your report, all they see is this account was closed, no reason to why, so it makes us look bad.
Michael Mancini
October 21st, 2009
1:00 pm
The banks have the right to cancel the cards at any time, and we do not need the government to step in. As far as I am concerned, the banks that close our accounts are doing us a favor. We need to learn to live within our means.
mark
October 21st, 2009
1:19 pm
It’s the big “we’re too big to fail that we had to bail them out banks” that are doing this. Go with a small community bank or with a Credit Union. It’s past time to let the Citi’s, the bank of america’s & the chase’s of the world implode and go out of business.
Marie
October 21st, 2009
1:21 pm
YES some of my credit cards have been closed without notice and I hate that the companies can do that, there should be a law which states that the vresit cards companies must inform the prople before they do anything, I also have had my balances dropped for no reason, and that too is unfairyou work all your life to have good credit and then the credit cards companies want to mess things up without telling you anything. It’s not fair at all!!!!
banks
October 21st, 2009
1:56 pm
Beware of bank cards/debit cards! I used my card at an ATM. Someone had hooked a device to steal peoples info when you swiped the card. They spent $4000 over the weekend which I was not aware of until it hit on a Monday. It took 8 weeks to get my money back in my account! Debit cards are unsecured! I had no recourse in this matter except to wait patiently while the fraud department investigated my claim!!! So much for using cash!!
SPnWinder
October 21st, 2009
2:31 pm
My cc companies raised my interest without me being late and always paying much above the min. This week I paid off everything except my house. I couldn’t swing that but wish I could have. It’s not easy to do, but you can do it. Don’t let the cc companies decide how deep in debt you are. All I can say is good riddance to each of them.
Michael Lach
October 21st, 2009
2:48 pm
http://www.RemoveMyCreditInquiries.org is a site I found that is ran by a non-profit that can remove credit report inquiries for $15. They also appear to remove late comments as well.
MELISSA SHEPHERD
October 21st, 2009
2:59 pm
I HAD 2 ACCOUNTS WITH WAMU FOR YEARS AND WAS CURRENT ON THEM AND NEVER LATE AND SHORTLY AFTER CHASE BOUGHT THEM OUT THEY WERE CANCELLED WITH NO WARNING. I ACTUALLY TRIED TO USE THEM AND STORE COULD NOT TAKE. ABOUT WEEK LATER OR MORE I GOT LETTERS ON BOTH STATING THEY WERE CLOSING THEM DUE TO HIGH CREDIT LIMITS AND THEY LOWERED A CREDIT LIMIT ON MY HUSBANDS FOR NO REASON
Out a Rebate
October 21st, 2009
3:44 pm
What the media, and therefore many of you, haven’t picked up on is that Citi closed the cards on the next to last day of the October billing cycle. Another piece of the fine print is that you forfeit any rebates you have coming to you if the card is canceled for any reason. Their deliberate timing of this caused the greatest possible rebate loss to every one of their cardholders.
Our family alone lost over $50 that we had coming to us.
This was definitely our last dealing with Citi.
Lee
October 21st, 2009
3:45 pm
How about this for a reason… lets say your mother is 93 years old and she has her prescriptions by mail set up to charge automatically to your credit card, and suddenly your mother stops receiving her prescriptions, because you define “private enterprise” as the absolute right to cancel a 93 year old housbound person’s credit card company to any card any time for no reason whatsoever despite the fact that they have always paid on time. hummm… “government interferrence” sounds like a pretty good idea?
Nocreditcard-cashonly
October 21st, 2009
6:20 pm
@Dave Ramsey Fan.. ditto! No credit card, completely debt free… rented a car, hotel reservation and airline ticket with a debit card,(Visa Logo):-) I just happend to have the money to pay for it…because I’m not paying off credit cards, mortgages, car notes and loans….. its amazing how much money you have when you’re not giving it away to debtors… Oh by the way, the mortgage is paid off too…don’t need the tax break since I pay less in taxes than what I’d get back in a refund.
Nocreditcard-cashonly
October 21st, 2009
6:46 pm
@banks–if you use your debit card, like a credit card…meaning you sign and not enter your pin..you get the same protection from Visa as if you had an actual credit card. Its when you use your pin that you have the problem. I know..I’ve been there. Just sharing…
Sean
October 22nd, 2009
1:33 pm
I wanted to cancel my Citi Cards anyway…funny how the gas card gets canceled and the normal Citi Mastercard doesn’t. No wonder Citi lost so much money this quarter.
Michael
October 23rd, 2009
7:04 am
Please Banks, Cancel all cards! The fear of inability to rent a car or get a plane ticket does not effect the millions in debt at 28% who have never (or rarely) rented a car or taken a flight. Then stores can give store credit again where you can buy the tv or the clothes but not charge $60 at Applebees on the way out of the mall. Stop spending what you don’t have. And file bankruptcy while house prices are down and equity is not exposed.
Jen
October 24th, 2009
12:40 pm
Closing an acct can negatively affect your scores if you have balances on other cards (your debt to limit ratio is changed), or if it was an old card since scores are based partly on your length of credit history. I don’t know if just closing an acct without those factors will have any impact on scores though.
Ted
November 3rd, 2009
10:07 am
I wish everyone would cancel their credit cards. F the credit card companies.
Toni616
November 5th, 2009
12:05 pm
Amex just cancelled my card without any notice! Although I agree with some of the other comments about using cash as much as possible. Sometimes it is just not practical. I never missed a payment even though I was had been unemployed for 3 months at one time but never missed a payment and paid more then the minimum. SO my tax dollars are bailing out the banking industry and the way I’m thanked is by having your card cancelled without notice end.
Pissed
March 18th, 2010
8:37 am
Discover Card just canceled my card of ten years for no reason and no notification. And when I called they told me lie after lie and were rude to boot. And after they lied to me 3 different times with three different lies, they asked me if I wanted to apply for a card. I will never do business with those scumbags again. Business is business but it is not fair that they can reduce my credit rating because of a ten year old card being canceled for no reason. The credit rating system has been rigged by the credit card companies and reflect their profit objectives more then my credit history.
When they send you the card offers in the future just take their postage paid envelopes and mail them back to them with nothing inside.