Please help: MBNA cancelled credit cards due to BillPay activities and not carrying balance

I don't know if this question belongs to this forum, as I am looking for advices. MBNA has just cancelled both of my credit card accounts with them without notifying me in advance (They said that they've tried to contacted me by phone the day they closed the account - my cell phone; yet I didn't get any message from them - which MBNA later said that they called, but hang up without leaving any message). When I contacted MBNA, I was put to their credit analyst department and spoke with the senior analyst, Michael Lock. Michael Lock informed me that MBNA did not like the pattern of my usage and chose to terminate my accounts without any warnings. He was referring to the facts that I have been using BillPay to pay my other credit cards, then paid off the MBNA balances for the past eight months (the balances are around ten thousands each month). When I asked Michael Lock direcly(yes or no question) that did I possess any risks to MBNA if I had a high balance, but have been paid them off every time, he reluctantly said no (My accounts with MBNA are over eight years, and I have never been late - or carry a balance). I then rephrase his analysis that my accounts were closed, and I was discriminated against, because I had high balance and paid them off - and they don't like that - he became upset and said that I took it too personally (maybe the word discrimination took too much weight) and my accounts are to remain closed. He also asked that I do not call back again (I called twice - the first time to ask for my accounts to be reopen).

What can I do? Can MBNA do that? Are there any wrong doing on MBNA part? Any advises are appreciated. Thank you.

Do a search, this was addressed a little while ago.

Took less than a minute

Hickup.

This scares me. I've started using Bill Pay on my Fidelity MBNA card to pay about $1000/month of other credit cards, as well as maybe $2000/month of purchases. Since I'm a FWer, I pay the balance on time every month. Does this mean that I'm at risk of having my account closed, too?

Call back again and ask that for one account to be reopened

A couple of questions OP:

1) Were you paying off your balances each month in whole or in part with balance transfers from other credit cards?

2) What percentage of your MBNA credit lines were you hitting when you were running those $10K/mo bill pays thru?

3) Would you characterize the income you disclosed to MBNA when you applied for your cards being sufficient to suggest that $10K/mo of credit card payments was reasonable?

Hoping to learn something about what MBNA was triggering off from your responses.

Thanks

Let's turn this around.

you obviously are not a profitable customer, mbna cannot tell you this str8 up. You expect them to continue losing profit which in turn will cost other customers more money. And they cut you loose.

As a finance person i can tell you this goes on all the time. In big business, folks will fire other companies because they end up not making profit from you.

It may seem unfair, and i agree you should complain. But companies don't stay in business by holding on to loss leaders... thats a fact.

dweick said: A couple of questions OP:

1) Were you paying off your balances each month in whole or in part with balance transfers from other credit cards?

2) What percentage of your MBNA credit lines were you hitting when you were running those $10K/mo bill pays thru?

3) Would you characterize the income you disclosed to MBNA when you applied for your cards being sufficient to suggest that $10K/mo of credit card payments was reasonable?

Hoping to learn something about what MBNA was triggering off from your responses.

Thanks


I paid my balances off in whole directly from my checking account. My total credit line from the two MBNA cards were 60000.00 (after 8 years of perfect usages --- no late payment, no balance carried). I would think that the income I disclosed to MBNA were reasonable to carry a $10K/month, but I think they don't really care about my income as the cards are closed, not adjusted. It's obvious that the reason they cancelled the accounts were that they weren't profitable. I am just not happy with the approach that they took. Maybe it's a hint at their current financial position....hmmm

You lost $60k in credit? Ouch!

Thanks for posting OP.

BlkSnday, thanks for your experience too. If you could provide more details (when they closed your accounts, whether you made any purchasers, etc.). that would be helpful too.

Any other information any of you could provide on similar situations would be most helpful. This is certainly a worrisome trend, effecting many FW readers, and any info on what's caused it thus far would be appreciated by many.

You guys need to share your looting with da man. You take his money, gamble with it, and return to repay the principal only if you come out ahead. If you lose, you tell him to suck it in BK court. Now, if da man lets this continue, soon he'll have to call you his 'daddy.'

While I understand MBNA's right to end the relationship, I wonder how the cardholder's FICO was effected? OP, can you pull your credit report and see how they closed it? I certainly would have hinted lawsuit to Mr Lock if I knew my FICO score would be screwed. I'm curious why they just didn't raise the rates, change the terms of payment, or the other usual tricks they pull to discourage you from using it.

didYOUsearch said: mbna would not be liable for your drop in FICO. as long as they provide accurate data about closed account, the fact some third party company compiles a report, yet another company creates a score, that yet other entites may use in credit decisions does not make MBNA liable to OP.

MBNA has been trying many novel ways to increase account profitability (insituting annual fees, elminiating extended warranty coverage, etc). It makes perfect sense they are trying to kill off those they deem to be "abusing" the billpay feature , who are not ccruing any interest, not making any purchases (hence no merchant fees) etc.

This is enough reason FOR ME o start making purchases on my MBNA cards used for billpay.

where do the merchant fees go? to MBNA or to the bank of the merchant (which could be a different bank, than MBNA)?

i'm not clear about this...

thanks in advance..

didYOUsearch said: everyone gets a cut, the CC processor, the CC issuer, etc

thanks, didYOUsearch-

and i agree with the "profitability"- thing...

banks are in business to make profit, too.. and it costs them to keep customers.. borrowing money at 5%-6% rate, but get nothing in return but COSTS...

thanks, again..

didYOUsearch said:
This is enough reason FOR ME o start making purchases on my MBNA cards used for billpay.
DYS, about how much are you planning to charge and are you planning to do it every month?

MBNA bill pay was ment for people to be able to pay merchant who normally dont take credit cards. Not to extend the cardmembers free grace period. I have an MBNA card that I never use. Last time I used it was back in 2002 as this card had no curency transaction fee. Back in 2003 MBNA sent me an a updated Consumer Agreement where they raised the fee to 1% at which time I stoped using it as American Express charges 1% also and gives me rewards. Even more recently they switch transaction from 1% to 3%. Banks are allowed to change the terms of there cards you can do like I did just not use it.

I think problem the OP had and maybe others who are using the Billpay system is they are basically using it so they can extend there due out by transfering the balance from 1 card over to MBNA then paying MBNA bill in full thus gaining anywhere from date transfered to closing date on there MBNA credit card + grace period. So you gaining an extra 20+ days of float on your money at the expeness of MBNA who is a bank and not in the bussiness of giving away free short term loans.

I think everyone understand that credit card companies and banks are in the bussiness of making money. While not illegal what the OP did surely commen sense would tell you that if you transfer balances just to extend your free float that it would surely be frowned on my MBNA. I am also sure the OP was doing this in large scale which is why it caught the attention of someone.

Is this "float game" that significant a savings to some people? It is only 20 days, and at 4% that comes out to roughly $22. So to save that $22, you just got $60,000 of credit withdrawn. Obviously you didn't know that this would happen, but in retrospect was it worth it?

Also, plenty of banks have free BillPay.

your and OP's stories let me a little nervous. lilely it will hit and hurt many FWers soon if major CC companies all start doing so.
I didn't own any MBNA CC until I got Schwab GC and ipod shuffle. But I have been using Chase, Citi, GM... and did lots Free BT among accounts. I am thinking to buy more i-bonds this month. jmm, have to re-thinkiit over.

BlkSnday said: I had a similiar termination with MBNA.
I had 2 cards with them, one $35000 and one $22000.
I do the convinient check to get their money work for me in CDs and paid off when the promotion expires, they then canceled my account without notice.
I'd called to asked during a weekend, they told me to call back on weekdays, but I dont care to call back.

What I don't understand is why MBNA lets you bill-pay to other credit cards at all. If they don't like it, why do they let you do it?

dolmar said: MBNA bill pay was ment for people to be able to pay merchant who normally dont take credit cards. Not to extend the cardmembers free grace period.

I have to disagree, the clearly encourage the use of BillPay to pay your credit card accounts:

About Bill Pay Choice

Bill Pay Choice lets you pay your credit card bills and other merchants such as your cable, power, and mortgage companies online in one convenient location.

tooshy said: cameron2003 said: I got his email. Strange, only one of my three are moving:


s you may be aware, MBNA and Bank of America have merged. Keeping you informed is our top priority as we combine our organizations and integrate our banking networks.

Currently, you view multiple accounts online. We are unable to automatically move all of your accounts from Net Access, the MBNA online banking service, to Online Banking from Bank of America . In order to continue to take advantage of the great features and benefits of online access, please read the instructions below:

Beginning Monday, October 23, 2006, you will need to enroll in Online Banking from Bank of America at www.bankofamerica.com in order to access the following accounts:

PS. the one they they I have to move is the one I use for the bulk of my billpay.Got my emails last night...Cameron, check your email again. I received 3 emails, identical message, moving 3, then one, then one more account. All but 2 Charles Schwabs are moved.

Nope, stil ljust that one email.