Ask an Expert: Card Canceled After It’s Paid Off?

Photo (cc) by くーさん

I review dozens of credit card offers each week to find the best deals. Check out more on our credit card page.

A Money Talks News reader wrote me recently with this interesting question…

I’m hoping you can offer some advice about what I can do to reopen my account with American Express. I’ve had an American Express Delta SkyMiles Card since 2003. Since then, my credit has decreased, particularly in the last few years when I became an unemployed, struggling law student.

I graduated last year and, with my new-found financial stability, I’ve begun to work on my credit. Last week, I paid off the full balance my Discover and American Express cards, which carried about $3,500. This week, I paid $1,000 on my other cards – and I’m now out of credit card debt.

On Tuesday, I received an email from American Express stating that my card had been cancelled. When I called, the rep explained that it was due to my high debt-to-credit ratio, late payments, and a charge-off. While I understand the reasoning behind closing my account, I’m curious if there’s any way that I can reopen my account based on my current financial situation.

– KM

First, KM, congratulations for getting out of credit card debt!

American Express has some great cards, but frankly, their actions here leave me scratching my head. Why would they cancel your card after you paid off the balance? I can think of two possibilities…

  1. American Express wanted to wait until you paid off your account before closing it, so they would have your money before upsetting you.
  2. American Express was going to close your account anyway, and it’s just a coincidence this occurred a week after you paid off your debts.

Either way, you might want to call one more time and ask if they’d pull up your credit report again – and notice your debt-to-credit ratio is much smaller now that most of your cards have been paid off.

But more importantly, step back and take a look at the big picture. There are dozens of credit card issuers, and American Express is just one of them. If they don’t want your business, go out and find a company that does. For example, here are 5 cards with low interest rates and another 5 great cards with no annual fees.

We’re lucky to enjoy an extremely competitive market for credit cards, and many people receive too many credit card offers as a result. As the late payment and charge-off recede into your past, your credit score will improve, and I’m sure you will find credit card offers from American Express and others filling up your mailbox before too long.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
19 Purchases That Buyers Almost Always Regret

Think twice before buying these things.

9 Ways to Boost Your Home’s Curb Appeal for Less Than $50

These products will instantly improve your home’s curb appeal without breaking the bank.

10 Bad Money Habits That Are Robbing You Blind

Here’s how to change those bad behaviors.

7 Reasons Workers Age 65 and Older Have Not Retired Yet

For some, the golden years are a time to increase the gold — but their reasons for delaying retirement vary widely.

15 Things You Should Always Buy at Yard Sales

You can save a ton of money — especially if you spot any of these items.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

Am I Eligible for My Mother’s Social Security Benefit?

Can an adult daughter tap into her late mother’s benefit?

9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

This Surprise Factor Can Raise Your Risk of Dementia

Nearly half of U.S. residents may face this threat.

Organize Your Home With These 10 Thrift Store Finds

Resolve to be clutter-free in 2021 with these secondhand purchases.

This Gas Station Scam Is Victimizing More Drivers

For the second straight year, a growing number of Americans believe they’ve fallen prey to this scam.

11 Laws You Could Be Breaking Without Knowing It

Seriously? Fibbing about the weather is a crime? This and other little-known legal traps await the unwary.

11 Generic Products You Should Buy at Costco

Not all generics are worthwhile, but these are among the best from Costco’s Kirkland Signature brand.

These Are the 3 Best Used Cars You Can Buy

These vehicles boast reliability, safety and long-lasting value.

13 Things Seniors Can Get for Free — or Almost Free

There are many ways to get cheap or free services and goods after reaching a certain age.

6 Legal Documents Retirees Need — but Don’t Have

Few retirees have all of these documents that are crucial to their golden years — especially during a pandemic.

8 Tips for Retiring Comfortably on Social Security Alone

It’s never too early to start learning how to live well while living on less.

Internet Providers Can’t Charge You for This Anymore

Starting this month, your ISP no longer can bill you for this fee.

15 Painless Ways You Can Cut Costs in 2021

Follow these tips to save, so you’ll have money for things that really matter.

9 Small Expenses That Are Bleeding Your Budget Dry

Keep more of future paychecks by eliminating these budget-busting unnecessary expenses.

The 4 Best Things to Buy in January — and 4 to Avoid

As a new year dawns, deals abound for some types of products. In other cases, it pays to wait.

11 Huge Retirement Costs That Are Often Overlooked

Does your retirement budget account for all of these costs?

Is This Treatable Condition Causing Your High Blood Pressure?

Researchers say too many doctors are overlooking this potential source of hypertension.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.