Update 2/22/21: USAA has sent out letters surrounding this error.
Update: Seems like this issue has now been fixed.
Today a number of people have reported issues with their USAA credit cards being reported as ‘closed by the creditor’ by credit monitoring software. When USAA is contacted they state the card hasn’t actually been closed and they are receiving high call volume due to this issue but are unaware of exactly what is going on. We’ve reached out to USAA for comment.
Hat tip to reader musclera via DocBasher (USAA subreddit)
i’ve been locked out of my card for 3 wks. and everytime i call i’m put on hold and when i get thru i’m put on hold . right after being put on hold i’m disconnected . i was sent a new card because of problems that did’nt exist . when i received the card and tried to activate it they keep telling me to activate a card that’s supposedly been activated already . they’ve kept me in limbo for 3 wks and counting . usaa has turned into a bush league banker that keeps telling its customers LIES . the BBB needs to step in to stop it.
“Update: Seems like this issue has now been fixed.”
Except it hasn’t. USAA did not send out snail mail or electronic snails notifying me – in theory, the lie sounds good saying they were on top of something they didn’t do.
I had stopped credit bureau monitoring saving associated costs during the pandemic and have only restarted them last week. What I found led me here to figure out what’s going on.
Precisely three days after their reporting “glitch”, Experian reduced my FICO-8 11 points. That short-term effect itself wouldn’t be so bad except, due to the increase in pandemic insolvencies, creditors have increased their “soft pulls” to nearly daily (AMEX is my best example) and basing decisions on bad information. The long-term effect with bad information in and junk out is being used to close other accounts or reduce credit available. This would actually be something concrete a consumer could tackle/fix, but first they’ll raise base variable rates (almost as usurous as “default rates”) on their way through to charging consumers more money or forcing them to close their accounts to avoid the higher interest.
Calling USAA, the agent almost seemed hostile like they have caught/are catching a ton of flack (and I’m paraphrasing here) said, “Yeah we know about the error, we don’t accept responsibility for it, and we can’t tell you why/who is to blame but we fixed our non-existent error. So if you have a problem with that then you need to take it up with the credit bureaus.”
The problem: There is nothing to actually fix now or report as incorrect in your credit file because the account remained open (and in good standing), HOWEVER anyone that pulled/computed a credit score during the time of the non-existent error didn’t have those score history issues “fixed”.
I’m not sure how to fix THAT.
Disputed information with USAA – they didn’t want to hear it as their “error” was fixed according to them. Disputed information with Experian – well, they don’t see a problem as original “error” was fixed immediately after except the FICO-8 score based on the bad information. Dispute closed, no action?
In the meantime, an additional creditor (will not name as it isn’t germane for this forum) decided to run with the bad information and used the fact of a lower FICO-8 score to penalize me an additional 5 percent on balances going forward effective today.
Reported this whole nasty chain of events to the Consumer Finance Protection Bureau (CFPB) today on their website naming names and supplying supporting debris, er, documents I mean.
Will return here with results if and when SOMEBODY accepts responsibility for this mess and reverses punitive actions taken on bad information.
It’s pretty lame that they waited 2 months to notify customers about the situation
They’ve fixed this issue, but are also re-reporting other cards you may have with them mid-cycle. Which typically wouldn’t bother me, but I use my limitless a lot and it annoys me for them to do that unprovoked.
The same thing happened to me. TransUnion score dropped 11 points on 24 Dec but I just checked CreditKarma today and the 11 points have been restored. I guess USAA is fixing the problem.
My credit card limit with USAA got suddenly cut from $20,000 to $3,000 about a year ago. No explanation upon contact. Such a disgrace, I closed the card.
The same thing happened to me. They started cutting the limit on my card about three years ago. They’ve lowered my limit several times. I wrote them a letter asking why and they sent me a canned response with bogus reasons why they were doing it. This card has been open since the early 2000s and when it’s used (which is rarely) it gets paid off in full, otherwise I would have closed it long ago.
Nothing amiss with my USAA. No reports of any closures. I haven’t used the credit account in a decade.
I contacted USAA yesterday (24 Dec) about the notification from my Chase Credit Journey report. Representative for USAA stated they are aware of the issue and are working to correct this with credit reporting agencies to ensure members who were impacted have reports updated stating accounts are not closed. Rep did not give a reason for why it happened but representative stated, accounts were definitely not closed, and over the next couple weeks the issue should be corrected with major CC report agencies.
They closed mines as well without explanation. Why would they do that to me?
The same thing happened with my USAA card too – I did a search and found this thread. I got an alert from myfico and could not figure out what was going on. When I went to Equifax to dispute it though, Equifax shows the account open and in good standing. That makes me wonder if it was corrected before I got the alert?? Anyone know? Really makes me wonder what’s going on considering there was a major hack recently of multiple sites that have not been disclosed. USAA has also done some super shady stuff with this particular CC of mine in the past also, which included slashing the credit limit twice when I pay off the balance every month. The only reason it’s still open is because it’s a 20 yr old account and I have a really high CS that I don’t want affected if I close it.
Just to add an update, I got a SECOND notification from myFico about this account being closed. I also looked on the myfico forums and USAA forums and this is a widespread problem. I am beginning to think this is a breach. Why would this happen the week of Christmas/Christmas Eve/Christmas day? I really, really hate USAA even more now because of this.
A breach that reported credit cards as closed, but never actually closed any credit cards? I suppose that’s possible, but for what purpose would someone breach a bank to do that? (Other than someone doing so just because they could.) There has been no indication of any fraudulent activity associated with this (at least none as if the time I’m typing this).
If the options are between malice or incompetence, incompetence is probably the more likely of causes. Though incompetence is maybe too strong of a word. It could just be someone was making changed to a system, went on Christmas vacation, and an unforeseen problem occurred while they were away.
Matt, malicious hackers could have found a way to change the accounts to closed right before Christmas in order to cause havoc with the IT teams and also initiate a barrage of disputes with bureaus and USAA. Not all data breaches involve data that is stolen, sometimes they can involve acts that deliberately disrupt or “break” something in a system.