Ensuring account is reported "closed"

Dear CEP,

If the lender has actually closed the account, then it should be updated automatically in your credit report to show that it is closed. That might take as much as 30 or more days, depending on when the lender updates its accounts with Experian.

However, I find that people often think they have closed an account while the creditor continues to have it open in their records. If sufficient time has passed and the account still has an open status, I suggest you send a letter to the creditor confirming that you would like to close the account.

A statement with the account will show “closed at consumer’s request” or “closed at credit grantor’s request.” In the past, who closed the account was often considered when evaluating risk. That is no longer the case because scoring models do not differentiate by who requested it be closed – a closed account is simply scored as a closed account.

If a credit grantor asked that the account be closed, it used to indicate that there were repayment problems and so would have a negative affect on credit scores. Today, people open and close accounts so often that who asked to close the account no longer has any meaning with regard to credit risk.

As always, I urge you to understand your credit utilization and the potential impact on that ratio before closing any accounts. You can read more about that in other columns.

Thanks for asking.