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Closed Finance Comp Trade Line - Good or Bad?


bmackay62
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I have read several posts regarding having OPEN trade lines for Finance Companies having a potential negative effect on your scores. However, I was wondering what effect CLOSED and PIF finance company trade lines have on your scores and credit history. I have several closed and paid finance companies on my reports, mainly from vehicles I have financed in the past, and one personal loan. These are all PIF and have no late or slow pays, etc. I recently applied online for a Chase Visa and was declined. The letter I received a few weeks later said that the decline was due to “Numerous Finance Company Accounts”.

I had assumed that a closed and paid in full account with a perfect history would be good thing – regardless of type? When I opened these accounts I had really poor credit, and these companies took their pound of flesh in the form of 19 and 20% interest rates. However, I bore through the pain, made all my payments over the years and hoped that my reward in the future would be positive trade lines and good credit. However, now it looks like just having those accounts in my history has hurt my credit more than it helped.

Question is, would it help to dispute the closed and PIF finance company trade lines and hope they delete? If so, will this hurt or help my scores overall? I have lots of other closed positive info and several open and current trade lines.

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You answered your own question.

"...I recently applied...and was declined...due to "Numerous Finance Company Accounts"..."

"...will this hurt or help my scores..."

The only way you will know is to obtain a score now, then dispute the old TL's off and obtain another score. Please report your results if you choose to do this. Empirical evidence is always valuable.

You may also want to contact Chase and get a more specific answer. The FCRA requires creditors to provide a "reason" for any deductions. Since a perfect score is theoretically impossible, there are always deductions, hence, always a reason. If you have a nice looking report with lots of history, no delinquencies, Public Records, or CA's, then what kind of reason are you gonna get? Let's see...this consumer does have some old Finance accounts...

I would suggest you forget about this and build some prime accounts, if you haven't done so already. Some things get taken care of with time.

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Just how numerous are your finance company accounts?

I'm concerned myself because I have a WFF account which I want to close.

Btw when I applied for a BoA card on the phone, I asked if having such kind of accounts looks bad to which the reply was "no". I guess different underwriters have different standards.

Is there any other reason why you might have been denied?

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