Can CC be closed without notice?

MINCTbw

I have a fair bit of CC debt, and a fair bit of cash in the bank. I could go some way to cancelling out the CC debt and saving on monthly interest BUT it's crucial for my plans this year that I retain access to that "spending amount", as I have some large purchases to make later in the year for a particular purpose.

Is there a chance that my CC providers (tesco, barclaycard, sainsbury's) may close my accounts when I pay off the balance, a bit like how an overdraft can be? If so, I will need to keep my cash safely in my bank account.

But if they "can't" do that, I'll go ahead and pay them off for now and then run them up again when necessary.

Thanks!

eskbanker

Closure is perhaps unlikely (but still possible) but they can unilaterally reduce your credit limits, which is more likely if the balances are much lower.

Ben8282

It is strange that you should be asking this question. Yes they could close the accounts but why should they? Do you have any particular reason, such as previous account misconduct, bad credit history etc to make you believe that they are likely to do this?

MINCTbw

Ben8282 wrote: »

It is strange that you should be asking this question.

Why's that, seems like a very valid question for this section?

Yes they could close the accounts but why should they?

That's not up to me.

Do you have any particular reason, such as previous account misconduct, bad credit history etc

My credit rating is poor due to debt levels but my payment history is impeccable.

to make you believe that they are likely to do this?

I have no current opinion on the matter, that's why I'm here to ask. I wasn't born with knowledge of how CC providers manage their customers' accounts.

MINCTbw

Ben8282 wrote: »

It is strange that you should be asking this question. Yes they could close the accounts but why should they? Do you have any particular reason, such as previous account misconduct, bad credit history etc to make you believe that they are likely to do this?

eskbanker wrote: »

Closure is perhaps unlikely (but still possible) but they can unilaterally reduce your credit limits, which is more likely if the balances are much lower.

Hmm, ok. Perhaps I could contact them and ask directly, they may tell me y/n if they would do that?

BoGoF

Why would they tell you?

[Deleted User]

No, they won't tell you, as the agents won't know. They also wouldn't tell you if they did know.

But if you're managing the account well, there's no reason for them to close it.

Carrot007

MINCTbw wrote: »

Hmm, ok. Perhaps I could contact them and ask directly, they may tell me y/n if they would do that?

Or interpret it as you are deprerate and close it.


No do not do that.

Ben8282

MINCTbw wrote: »

Why's that, seems like a very valid question for this section?

.

Perhaps I should rephrase. The question is valid yes, but it's just that most people wouldn't imagine that their credit card accounts were likely to be closed as a result of repaying the balances which caused me to wonder if there was a reason why you imagined that your accounts would be.

SnowTiger

MINCTbw wrote: »

I have a fair bit of CC debt, and a fair bit of cash in the bank. I could go some way to cancelling out the CC debt and saving on monthly interest BUT it's crucial for my plans this year that I retain access to that "spending amount", as I have some large purchases to make later in the year for a particular purpose.

Is there a chance that my CC providers (tesco, barclaycard, sainsbury's) may close my accounts when I pay off the balance, a bit like how an overdraft can be? If so, I will need to keep my cash safely in my bank account.

But if they "can't" do that, I'll go ahead and pay them off for now and then run them up again when necessary.

It's more likely a credit card provider will reduce your limit rather than close your account completely.

CC providers can close an account to new spending even if there's a balance outstanding on it.

Barclaycard's T&Cs, for example, contain this:

This agreement has no fixed term. This means it willcontinue until you or we decide to close your account.

You can close the account by calling or writing to us, and we can close the account by writing to you. Unless we are closing your account for one of the reasons below, we’ll give you at least two months’ written notice.

We may close your account and require immediate
repayment of your total outstanding balance for the
reasons below:

• If we reasonably believe that you’ve broken this
  agreement regularly or seriously
• If you have acted fraudulently
• If the Home Office tells us that you have become a
  ‘disqualified person’ due to your immigration status
• If you become bankrupt (or enter into a voluntary arrangement with your creditors) or if we believe this is likely to happen
• If you die (in this case, we may ask your estate to make the repayment)

IIRC correctly I have read stories here about folk who have paid off a portion of credit card debt, then seen their limit reduced by a similar amount.

Barclaycard's T&C:

If we reduce your credit limit based on an assessment of risk or your ability to repay, we have the right to not give you any notice beforehand if we think this would not be appropriate.

Other card providers will have similar clauses in their T&Cs.

Having said all that, I don't think it's common practice to close an account or reduce limits after a portion of debt has been paid off.

MINCTbw

Cheers - sounds like it can happen but usually not. I'll pay bits off and see if they edge my limit down. If not, I'll pay more off.

Thanks, all