A few weeks ago I received an email from Discover informing me that they are closing my credit card due to serious delinquencies and my balances being too high on other accounts. Before receiving this email I had no clue that a company could do this. I have never heard or even seen this before.
I don’t blame them as on paper I am at risk individual. I am sure they see the potential that I could rack up the credit card and not pay it.
This credit card was opened with the purpose of a balance transfer of $3,298.00 for a 24 month 0% interest rate on 03/09/2017. After 24 months the interest was going to be 31.79%. I payed $150 a month until it was payed off. The last activity on this account was 10/18/2018 when I made my final payment of $218.44.
#1: Balance transfer done right 👏
There is a couple insights to gain from this. The first one being that I took full advantage of the 24 month 0% interest rate. My minimum payment was $35. , If I made just the minimum payment I would have only paid off $840. But instead I took the total and divided it by the number of 0% interest rate months. I was able to pay off the balance without paying a dime in interest.
#2: Change to debt-to-limit ratio 😑
The second insight is now my debt-to-limit ratio has been changed from 56% to 44% when they closed the account. I didn’t need access to the money, but I did need access to the credit. Because my debt-to-limit is lower this means it lowers my credit score.
The email ✉️
The following is the email I received from Discover.
Synchrony Bank also closed down a credit card of mine, see below for the reasons.