How to Reopen a Closed Credit Card Account

Have you ever tried to reopen a closed credit card account? It may be difficult, but not hopeless. In some cases, contacting the credit card issuer and requesting that they reopen your account might be possible. However, there’s no guarantee that they will be willing to do so. 

In this article, we’ll explain what you need to know about reopening a closed credit card account. We’ll also tell you how to improve your chances of success. So let’s start with the fundamentals.

Why Do People Want To Reopen an Account?

It can seem obvious to close a credit card account. After all, there is no reason to have a dormant account open. Even though you’re not using it, there are some solid reasons to reopen a closed account.

Your credit score is essential. It is one of the key factors that lenders look at when considering you for a loan. A good credit score can mean a lot of difference. This includes getting a loan with a low-interest rate and getting denied for a loan.

One of the things that can help improve your credit score is having an open credit card account. A reopened credit card account is an account that was closed by the cardholder but has since been reopened. Here are 5 benefits of having a reopened credit card account:

• Improves Your Credit Score

A closed credit card account can harm your credit score. However, by reopening the account, you can improve your score by showing that you’re making good use of credit. 

One way to improve your credit score is to have a credit card that reports to the credit bureau. This can be a Prepaid card that reports to the credit bureau. This type of credit card can help you to build up your credit history and improve your credit score over time.

Likewise, you can use cheap credit repair services to help you settle your credit card-related crisis. Their services circumvent addressing errors and negotiating the removal of negative items from your credit report.

By employing their services, they shoulder the burden of fixing all credit-related issues on your behalf, allowing you to achieve the perfect credit score.

• Gives You Access to More Credit

Having a reopened credit card account gives you access to more credit. This can be helpful in times of emergency.

• Shows Lenders You’re Creditworthy

Lenders want to see that you’re using credit wisely. So by reopening your credit card account, you’re showing them that you’re creditworthy and capable of managing your finances.

• Helps You Build a Good Credit History

Reopening a closed credit card account can help you build a good credit history if you’re just starting with credit.

• Allows You to Take Advantage of Rewards and Perks

Many credit cards offer rewards and perks, such as cashback or points. You can use it for travel or other purchases. You’re missing out on these benefits if you have a closed credit card account.

How to Reactivate a Closed Credit Card Account

Many people close credit card accounts, only to realize later that they need them after all. Fortunately, it’s not hard to reopen a closed credit card account. In most cases, you can do it in a few easy steps. 

1. Find Out The Reason for Account Closure

First, you’ll need to check the reason for the closure of your account. There are many reasons why the bank that issues your credit card might close your credit card account. This may include inactivity, missed or late payments, etc. 

You might have a higher chance of getting your card reopened if the card issuer closed it based on inactivity rather than with late payments.

2. Prepare Supporting Documents

After you know the reason for your account closure, you get the needed documents in place. This may include the card itself if you still have it. Your credit card account statement, name, address, and social security number should also be handy.

3. Contact the Credit Card Company

Next, you’ll need to find the contact information for the credit card company. You can find this information on the back of your card or on the company’s website. Once you have the contact information, you’ll need to call them and explain that you want to reopen your account. 

The representative will likely ask you a few questions about your credit history and why you want to reopen the account. Once you’ve answered the representative’s inquiries, you’ll need to wait for a decision. 

4. Activate and Use the Account

If the credit card company decides to reopen your account, you’ll need to make a deposit and activate the account. You’ll also need to make timely payments to rebuild your credit history. Ensure you avoid anything that may damage your credit score. 

How to Make the Most of a Reopened Credit Card Account

If you have a reopened credit card account, you may wonder how to make the most of it. Here are a few tips:

• Use Your Credit Wisely

Missed payments are one of the reasons that lead to the closure of credit card accounts. To avoid getting into trouble again, ensure to use your credit wisely. Pay your bills on time and keep your balances low to avoid costly fees.

• Monitor Your Account Activity

It’s vital to keep an eye on your account activity to ensure everything is accurate. If you see any suspicious activity, report it to your credit card issuer right away.

• Stay Current on Your Payments

One of the conditions of having a reopened credit card account is that you must stay current on your payments. If you fall behind, your account could be closed again.

• Check Your Credit Report

You should check your credit report always to ensure there are no errors. If you find any inaccuracies, dispute them with the credit bureau.

• Use Your Credit Card Responsibly

To use your credit card responsibly means making all payments before or by the due day every month. Making timely payments allows you to bypass penalties and other unnecessary fees that will affect your credit score. 

It also means staying well below your credit limit. You can achieve this by buying necessities compared to spending on every whim. You can also achieve this by staying below your credit limit monthly. 

The CFPB warns credit card holders not to go too close to their limit. They advise cardholders to use no more than 30% of their total credit limit. That way, they get to avoid problems because their credit limit is lowered.

Overall, your credit score can gradually rise if you use your credit card wisely. In addition, this will make it easier to get approved for new credit.

Disadvantages of A Closed Credit Card Account

As will all things, certain disadvantages exist to owning a closed credit card account. For starters, closing an account can lower your credit score. This is due to the fact that closing an account can decrease your credit utilization percentage. This is the amount of credit you’re using for the quantity of credit available to you.

A lower credit use ratio can signal to creditors that you’re a higher-risk borrower. This may result in increased interest rates and reduced credit limits. 

Another reason to keep your account open is that it can help you maintain a longer credit history. Lenders often see a long credit history as a positive, showing that you’ve been active. 

Whether you should reopen a closed credit card account is a personal decision. But you may want to consider it if you are looking for great credit scores. 

Wrapping Up

To reopen a closed credit card account, you’ll need to contact the issuer and request that they reopen it. In addition, you may need to provide additional information, such as your current financial situation. This may also include why you want to reopen the account. 

If the issuer agrees to reopen your account, you’ll need to restart the account with a new account number. You may also need to pay a fee to reopen the account.