Canceling Bank of America/Hawaii credit cards: be careful…and how my credit scores took huge hits

Last fall many of us got 3 credits cards in one swoop:

  • Bank of America Hawaiian Airlines® Visa Signature® Card
  • Bank of Hawaii Hawaiian Airlines® Visa Signature® Credit Card
  • Virgin Atlantic American Express® Credit Card from Bank of America

This was thanks to the research done by Million Mile Secrets (see here and here). The Bank of Hawaii card is issued by FIA Card Services which is part of Bank of America, although FIA uses a different online account management platform than BOA. The primary appeal for many is 1:2 transfers from both programs to Hilton HHonors, now less attractive due to Hilton’s recent devaluation of HHonors points.

These were my first annual fee-charging Bank of America credit cards. I previously had the Schwab credit card which was converted to the no annual fee BankAmericard Cash Rewards™ Credit Card when Schwab pulled out.

For each of the cards the annual fees were charged a few days after the anniversary statement close, meaning the annual fees were not billed until the 13th month statement.I had gotten the cards in November 2011, the annual fees were not billed until the January 2013 statements.

I had seldom used the 2 BOA cards and there was no retention offer. I converted them to BankAmericard Cash Reward cards among several no fee choices. The CSR was very knowledgeable as he walked through the convoluted conversion process. It involved opening a ticket for the conversion to happen at a later date, just before the statement bill due date, which would trigger the refund and convert the cards. He couldn’t explain why the systems are that way, but he was right and the conversion happened on the date specified without a hitch. The annual fees disappeared, I had $0 balances and 2 new  Cash Rewards cards. I had paid close attention to BOA because of the elaborate process. My focus should have been on BOH.

BOH I outright cancelled. There was no retention offer and the downgrade offer was for the $50 annual fee platinum version of the card. The CSR confirmed my account was closed, the fee would be refunded, and everything was complete. My FIA online account showed the account closed and I forgot about the card. Big mistake.

On Sunday I refreshed my credit reports with Citi Identity Monitor, shocked to see each of my scores drop about 80 points from the prior month. I hunted amidst all the green “current” circles and found a yellow “30” triangle under FIA.

I went into my FIA account and found the refund never was processed so a new billing statement was issued with a late charge. I also noticed that FIA’s website does not have the typical alerts that can be activated for things such as payment due. I had not paid attention to this card and had assumed there would be alerts like other cards.

I called in and the agent was very apologetic, the notes in my file were all there, the refund should have been processed, but wasn’t. I am generally quite obsessive about these things, have never missed a payment on anything, yet I made the mistake of trusting that it was being processed. FIA has corrected my account and has issued a correction to the credit agencies, a process they estimate to take roughly 30 days. Hopefully it will be that easy.

Lots of mistakes here, take them as a cautionary tale:

  • Getting cards I did not really need or care about
  • Not making sure I understood the ‘ins and outs’ of a card issuer new to me
  • Not verifying account alerts
  • Waiting to cancel until the annual fee was already billed
  • Not paying the annual fee – waiting for a refund check is better than a dispute
  • Not verifying the refund

Notice all the mistakes are on me. Sure, the bank should have processed the refund, but the onus is on me to get this right.

Take the time to review your outstanding accounts, make sure your alerts and tracking methods are airtight, and pay special care to account closures.

For bedtime reading, read the article and comments of Million Mile Secrets’ Warning: The 5 Dangers of Applying for Credit Cards.

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  • Same Thing

    The exact same thing happened to me and I have been trying to resolve it with upper level management for several months now. In the end, it will be OK, but it has been a major pain in the ass!

  • Yup. I cancelled mine last month, and the fees aren’t due for another month or two.

  • SK

    Yes i always pay the bill, regardless of if i really had to or not. Fees are only 80 bucks and in the big scheme of things, its not a big deal. Usually I don’t care when i get a check, as long as there’s a negative balance on my card. I remember leaving a $35 dollar credit on a closed card for about 6-9 months. I think after a year they mailed me a check and closed it for good.

  • Mike

    SAME THING HAPPENED TO ME I CALLED THEN AND IT WAS LIKE THEY KNEW WHAT WAS GOING ON. AFTER THEY SAW MY ACCOUNT WAS CLOSED HE WAS CLICKING AWAY I THEN ASKED WHAT ABOUT MY CREDIT AND HE SAID HE WAS WORKING ON IT AND TRIED NOT TO TELL ME IT HIT MY CREDIT REPORT AND IT WILL TAKE 30 DAYS TO FIX. UGGGGGHHHHH

  • Andre

    Very good advice points. I didn’t have the card or this problem, but I definitely appreciate the tone of the article. Much nicer than screaming and yelling about the bank’s failure, which is seen too often in other places when a bank screws up or doesn’t honor a targeted offer.

    Now I should follow your advice and set some reminders before my annual fees are charged, so I can reconsider what I’d like to keep.

  • jim

    hey bro,
    i have lots of expereince with boa cards.
    I manage cards for my wife and sister and i make calls for them as if i am them and my name is asian name so the agents don’t know.

    1ST, The worst thing is, unlike other card companies, BOA does hard pull on transferring CL to other BOA cards.
    DOn’t be fooled by the agents telling you there will not be HARD PULL and it will just be a basic question about income and blah blah. When my sister closed and transferred her Hawaain airlines card credit limit to her cash rewards card. they did hard pull. I called their top credit dept agent to complain and listen to my phone conversation, but they told me that can either reverse the cl transfer or and remove the inquiry or they can do nothing. I agreed for the first one, but this time again, they did another hard inquiry again.
    i will fight those 2 illegal inquiry and will not rest.

    my second advice is:

    when you close a BOA card due to annual fee or any reason, pay off any balance except the AF and when you cancel, make sure to tell the agent to adjust the AF and only than close it. My wife called to cancel her card and after 1 month, we say CLOSED WITH UNPAID BALANCE DUE $75. i called to have it fixed.

  • Bob

    How do refresh your credit score for Citi Identity Monitor?

  • @Bob – go to Product Features then Credit Report, you can refresh once every 30 days, if it has been 30 days or more you have the option to update your report, if it hasn’t been 30 days you just see you current report. After updating, go to Product Features then Credit Scores and you will have the new scores.

  • Bob

    I wouldn’t have known about how to update the score otherwise. Thanks so much!

  • john

    Interesting. I guess I got lucky I cancelled before the fee was due.
    Yes the FIA website is lacking and their policies are annoying. I tried to move the credit from the BOH card to my Fidelity card but they said nu’uh, that if I wanted more credit on Fidelity it would be a hard pull.

    Now I am concerned about what jim said. I also converted the virgin atlantic card to a bank americard. Did you get a hard pull? or is it a hard pull just for changing credit lines?

  • PedroNY

    BOA/FIA cards are an interesting animal, as they do not behave the same way as Citi, Chase, Amex or Barclay.

    From experience:
    1) The first anual fee does not post till your 2nd statement closes.
    2) If you are able to spend required minimum in the first 30 days you will get your points/miles once first statement closes
    3) Once you send them a check (or pay online), in theory your account balance is $0.
    4) There will be a pending anual fee charge.
    5) Call the the phone rep and ask them to remove it OR you will close the account.
    6) they can remove it, and there is no fee. If they say “no”, then you can still close the account.
    7) Once 2nd statement closes, you should receive it in the mail, and it will indicate that account had anual fee adjustment. If it does not, you still have time to call and figure this out.

    Enjoy,

    PedroNY

  • Joediver

    Wow! I had no idea this happened to so many others. BOH has the worst csu’s and I was on hold for an hour to even speak with a live person. Never again

  • Matt M

    Does anyone know if I can transfer my Alaska Airlines card into the Fidelity Amex? Or am I only able to transfer to the BankAmeriCards?

  • Matt M

    I was just told by a BofA employee on chat that I can’t convert my card, that I would need to close it and open a new account to get an annual fee-free card.

  • @Matt M – it is probably worth at least another try by phone to downgrade. I did not find a solid case of downgrading other than some older threads like this of people downgrading to a little-known Platinum version of the card but it looks like that has an annual fee and I am not sure that it still is available, worth mentioning, though.