Active account reported as closed

CuriousGirl
CuriousGirl Posts: 86 Forumite
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edited 5 December 2019 at 12:26PM in Credit file & ratings
Yesterday I received a message from Credit Karma about a change to my credit score and out of curiosity logged into my my account to check what's going on. To my surprise I found that my CC account with Sainsbury's bank is closed and settled on 29 November. Which was a total shock to me as I have not received any notifications regarding the account closure whatsoever.

Needless to mention I have not used the card for 13 months after I took a good balance transfer offer back in July 2017 and paid the balance within the 0% offer period. . Knowing about potential closure in case if the card not being in use for a long time I was going to use it for a single purchase and even requested the PIN reminder a few weeks ago. I have no intention to close account as I don't want the closure to reduce my credit utilisation and the length of my relationships with financial institutions.

Called the bank customer service and they had no idea why my account reported as closed to Credit Karma (Transunion) , I was advised to keep using my card and promised to investigate the issue. On my return home found a letter from the bank , dated 28 November ( yesterday was 4th December), warning about potential closure of my CC account if I don't use the card within the next 2 months.

My question is - any idea what to do next ? I am quite angry as I do not understand why my account reported as closed & settled whilst it is still open. I am not concerned about my fictional credit score with Credit Karma (which is 2 points downs because of the 'closure'), but I am concerned about how it will affect my credit history.

Thanks in advance.
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Comments

  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
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    Assuming you have other accounts, it's going to have minimal impact.
  • CuriousGirl
    CuriousGirl Posts: 86 Forumite
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    I do have other accounts, my total credit line is over £45k and the 'closed' card has a £3500 limit. I, however, have a substantial CC debt incurred due our new home improvement. It is all at 0% promotional rate, I am paying more than min every month and it is going down nicely.

    My credit utilisation is less than 30% even taking out of the equation the Sainsbury's CC limit . I also face remortgaging in July next year and want it to go smoothly. I just don't like the fact of the incorrect reporting. Is there any point to complain and ask them to correct their error?
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
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    I personally wouldn't bother, but it's up to you.
  • Tallaght
    Tallaght Posts: 1,632 Forumite
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    Some cards do close accounts if there has been no activity for so long but they do usually send a reminder.
  • TadleyBaggie
    TadleyBaggie Posts: 6,051 Forumite
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    Closing what was a dormant account is going to have no impact on your credit history, or rather on how future lenders perceive any risk.
  • vacheron
    vacheron Posts: 1,603 Forumite
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    If I were you I would let it close.

    My thinking being that then when your current 0% CC deals come to an end, you could find yourself eliigible for a nice Sainsburys promotional balance transfer card as a "new" customer!
    • The rich buy assets.
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  • Ben8282
    Ben8282 Posts: 4,821 Forumite
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    edited 5 December 2019 at 7:19PM
    I am not concerned about my fictional credit score with Credit Karma (which is 2 points downs because of the 'closure'), but I am concerned about how it will affect my credit history
    How do you KNOW that the drop in 2 points on your CreditKarma credit score was due to the closure?
    Obviously you are concerned about it or would not have mentioned it.
    Exactly how do you imagine a closed credit card account will adversely effect your credit history?
    I do have other accounts, my total credit line is over £45k and the 'closed' card has a £3500 limit.
    Total credit line? Is that some sort of imported US expression?
    My credit utilisation is less than 30% even taking out of the equation the Sainsbury's CC limit
    I don't want the closure to reduce my credit utilisation and the length of my relationships with financial institutions.
    It won't reduce the length of your relationship with Sainsburys for another 6 years. The closed account will remain on your credit files for the next 6 years with it's current account age.
    If your credit utilisation is less than 30% with total available credit in excess of £45,000 then I don't think you have much to worry about although you do have a significant amount of unsecured debt which you may need to reduce (depending on income etc) before applying for a new mortgage.

    13 months is quite a short time for a credit card provider to close an account for dormancy. As the account is apparently still open why don't you just use the card if you want to keep it? Presumably when a balance appears Sainsburys will be forced to start reporting the account as open again but I think that even if they didn't you would be winning. If Sainsburys stop reporting the card then you can use it as much as you want without the balance being reported and the card will continue to show as closed with (presumably as it is closed) a 0 balance. So you win!
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    vacheron wrote: »
    My thinking being that then when your current 0% CC deals come to an end, you could find yourself eliigible for a nice Sainsburys promotional balance transfer card as a "new" customer!

    Given the withdrawl from the mortgage market. Sainsbury's Bank is more than likely preparing itself to be sold on.
  • CuriousGirl
    CuriousGirl Posts: 86 Forumite
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    Thank you everyone for your responses.
    As to Ben8282's post
    Ben8282 wrote: »
    I am not concerned about my fictional credit score with Credit Karma (which is 2 points downs because of the 'closure'), but I am concerned about how it will affect my credit history
    How do you KNOW that the drop in 2 points on your CreditKarma credit score was due to the closure?
    How do I KNOW ? Easy peasy - there is a monitoring tool and it clearly shows the drop due to the closed & settled account.
    Ben8282 wrote: »
    Obviously you are concerned about it or would not have mentioned it.
    Exactly how do you imagine a closed credit card account will adversely effect your credit history?
    Not concerned but I do regularly check my credit reports with all credit agencies. The length of my relationship with financial institutions does worry me as I periodically open new accounts and switch them to get bonuses.
    Ben8282 wrote: »
    I do have other accounts, my total credit line is over £45k and the 'closed' card has a £3500 limit.

    Total credit line? Is that some sort of imported US expression?
    Does it really matter ? As long as the expression makes sense.

    [QUOTE=Ben8282;76574804
    My credit utilisation is less than 30% even taking out of the equation the Sainsbury's CC limit
    I don't want the closure to reduce my credit utilisation and the length of my relationships with financial institutions.
    It won't reduce the length of your relationship with Sainsburys for another 6 years. The closed account will remain on your credit files for the next 6 years with it's current account age.
    If your credit utilisation is less than 30% with total available credit in excess of £45,000 then I don't think you have much to worry about although you do have a significant amount of unsecured debt which you may need to reduce (depending on income etc) before applying for a new mortgage. [/QUOTE]

    It is all in hands and under control. I am the breadwinner in the family and my husband has just been offered a new job which will make a huge difference to our overall financial situation.
    Ben8282 wrote: »
    13 months is quite a short time for a credit card provider to close an account for dormancy. As the account is apparently still open why don't you just use the card if you want to keep it? Presumably when a balance appears Sainsburys will be forced to start reporting the account as open again but I think that even if they didn't you would be winning. If Sainsburys stop reporting the card then you can use it as much as you want without the balance being reported and the card will continue to show as closed with (presumably as it is closed) a 0 balance. So you win!
    That is exactly what I am/was going to do.
  • Mrs_Ryan
    Mrs_Ryan Posts: 11,832 Forumite
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    This happened with mums Debenhams card- but she uses it regularly and the card still worked fine. She did take them to the Financial Ombudsman though so I guess in her case they were chucking their toys out the pram.
    *The RK and FF fan club* #Family*Don’t Be Bitter- Glitter!* #LotsOfLove ‘Darling you’re my blood, you have my heartbeat’ Dad 20.02.20
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