Question about bank/credit accounts

[scott.cr]

Hi guys, I understand there is some type of law, and I'm not sure if this is a California thing or U.S. federal law, that states financial accounts must be "active" otherwise they can be closed, siezed, or whatever.

I have two Chase credit cards that have had zero balances for quite some time. (I'm punishing them for gawd-awful customer service.) I would like these accounts to be open in perpetuity to keep a favorable debt-to-credit ratio and thus a favorable FICO score. These two Chase accounts represent about 66% of my revolving credit.

Is not using these accounts for several years going to cause a problem that would prevent me from keeping them open?

 

[Badbeams3]

I have a Chase account that I didn`t use for about 3 years...0 balance. After a while it disapered from my credit reports and my score dropped down...but the account did not close. A few months ago I did a balance transfer to it...took advantage of a 2.99% offer. I don`t know if it improved my score...should have...as you know...the debt to credit availible ratio should have improved...

 

[Fizz753]

From what I have read it is better to use them every month or two so they stay "active". Does not need to be anything big, a small pack of batteries or some other small item. Just make sure you pay the entire balance off at the end of the billing cycle.

I have heard of some credit card company's canceling accounts due to inactivity. And by doing the above you keep adding more "on time payments" history as well.

 

[BB]

The problem with California is that inactive bank accounts and "abandoned" property are transfered to the state after ~3+ years... So, for us, I have some accounts that are there to qualify for free checking or something like that--and I don't transfer funds in/out on a normal basis...

Every couple years, I get a warning letter from my bank and I have to transfer $1 in or out to keep the money from going into state hands (my other accounts with the same bank are active--go figure)...

Recently (2003 suit filed, 2007 court decision filed), this has lead to lawsuits...

Every state in the United States has an unclaimed property law loosely based on English feudal law known as "escheat." Essentially, it means that in the absence of an heir or rightful owner, property reverts to the lord state or sovereign. Many states have become more aggressive about locating those forgotten assets, and less aggressive about trying to find the rightful owners.

But a ruling by a federal judge in California has halted that state's practice of seizing lost or forgotten assets.

Attorney Bill Palmer in Sacramento, Calif., represents more than a dozen plaintiffs in lawsuits against the state. He says that in recent years, the state controller's office turned what was essentially a "lost and found" for unclaimed property into a "for profit" business that provided nearly $400 million a year for the cash-strapped state.

Several times (IIRC) this has been stopped--the latest was this year:

For now, a federal judge has slapped an injunction on the California controller's office to make sure these assets remain in safekeeping. The judge found the state's practice of notifying property owners through generic newspaper ads to be unconstitutional and has halted the further seizing or selling of private assets until the state satisfies the original intent of the law — to reunite owners with their assets.

California did not even bother to contact the owner at known state of California addresses...

There was even one case, that I recall, where somebody got Cisco stock (or some similar stock like Intel) and moved back to England. California just simply told the company to print up duplicate shares and then sold them (the real shares were with the owner). Additional problem was when the real owner went to sell them (at a much higher price), the state is refusing to do anything about the price differences.

Ah, here is the court order and a couple of the plaintiffs:

[The case is filed] by two individuals against the state controller. One, Chris Taylor, a former Intel employee, lives in England and owns 52,224 shares of Intel stock. The other, Nancy Pepple- Gonsalves, a former TWA flight attendant, lives in California, in Riverside County, and owns 7,000 shares of TWA stock. Or at least they did own the stock, before the state took it away.

The state controller took Mr. Taylor's and Ms. Pepple- Gonsalves's stock as "unclaimed property." But these individuals do, in this lawsuit, claim it. The property was treated as unclaimed because for three years these two individuals did not cash dividend checks, respond to proxy notices, or otherwise communicate to the companies in which they owned stock. Intel and TWA provided the State of California with lists of shareholders who were "lost" or "unknown" by these three criteria, as required by law, and issued "duplicate shareholder certificates" to the state. The Controller then sold the stock and deposited the money received in exchange into the state's general fund.

-Bill

 

[LuxLuthor]

Yeah, this is important to make people aware of. Especially if you have had a change of address, and the USPO no longer forwards mail.

Best way to get the credit cards is overpay amount owed by 1 cent. They then go through the expenses of sending you a statement for quite a long time. I think I got statements for over a year with the 1 cent credit.

 

[K A]

Yeah, this is important to make people aware of. Especially if you have had a change of address, and the USPO no longer forwards mail.

What information do you have that says the USPO no longer forwards mail? I worked at a data entry center for the PO and there was always plenty of mail in the system that was getting forwarded.

 

[LuxLuthor]

What information do you have that says the USPO no longer forwards mail? I worked at a data entry center for the PO and there was always plenty of mail in the system that was getting forwarded.

They forward mail to your new address for a time, then stop and return to sender.

 

[scott.cr]

All, thanks for the responses, especially BB for taking the time to make a rather lengthy post!

I guess it won't kill me to put a gallon of gasoline in the tank on my two Chase cards. ;-) On the other hand, it is still sort of a pain in the butt because after I pay off the balance there will be a finance charge (or some other charge - they always manage to find something) on my statement. The last time I put a few bucks on the card, a miscellaneous charge the following month went unnoticed by me until it turned into some $39 late fees, further penalities, and of course more finance charges. They also retroactively charged finance fees for older balances that were already paid off months earlier.

I fought Crapital One for an entire year over this - after closing my account (due to frustration with their lousy customer service) I had a mysterious $20 refund from nowhere, which automatically re-opened the account, added a $55 member fee, later turned into late fees because I didn't know about my newly reopened account, etc etc etc etc.

Okay I'll stop ranting now. ;-)