I can't find anything in Reg Z which would prohibit us from temporarily suspending a credit card account until payment is made or closing it for delinquency (AAN would be required for the later). Our credit card agreement doesn't speak to the issue either. Am I missing anything in Reg Z? Would we have to notify the cardholder that the account is suspended until payment is made? Or is Reg Z also silent on the issue?

I don't know if there are any other caveats, but see: 226.9(c)(2)
(2) Notice not required. No notice under this section is required when the change involves late payment charges, charges for documentary evidence, or over-the-limit charges; a reduction of any component of a finance or other charge; suspension of future credit privileges or termination of an account or plan; or when the change results from an agreement involving a court proceeding, or from the consumer's default or delinquency (other than an increase in the periodic rate or other finance charge).

Thanks, Southern Banker. I thought I had gone over 226.9 pretty thoroughly....obviously not! But do you agree that if we temporarily suspend the account and then later terminate it, we would have to send an AAN under Regulation B?

Refer to ECOA
§ 202.9 Notifications.

(a) Notification of action taken, ECOA notice, and statement of specific reasons-- (1) When notification is required. A creditor shall notify an applicant of action taken within:
.
.
(iii) 30 days after taking adverse action on an existing account;. . .

Thanx bunches.....

Jumping in here!

If we periodically pull credit card holders' credit reports and review for adverse history (judgment, BK, increased debt)and based on that review suspend their credit lines, does that fall under 1026.9(c)(2)(vi)[reduction of credit limit] or (v)[termination of acccount]? If its (vi), am I understanding it correctly that we must notify them 45 days in advance? Most people will run up the line, so I am thinking I am not understanding this correctly. if its (v), I can't believe we can close their line without providing them notice. Please help.

Hate to be a pest, but can someone help me figure this out? I think it must be (c)(2)(vi), but I can't understand how we protect ourselves if we have to send the notice out 45 days in advance.

For (vi), you have to send the notice 45 days prior to charging an overlimit fee. "Notice shall be provided in writing or orally at least 45 days prior to imposing the over-the-limit fee or penalty rate and shall state that the credit limit on the account has been or will be decreased."

So if you decrease the line, send the notice the day you decrease it, and don't charge them any over limit fees until 45 days have passed.

In my opinion, if you close or suspend the account, it doesn't fall under change in terms in Reg Z, you would have to go to Reg B's rules of adverse action and notify them within 30 days of taking the adverse action.

Just my opinion, and I could be wrong!

Thank you #12! I was S-L-O-W-L-Y coming to that conclusion. I just think it seems it a little weird we can close your credit card account with no advance notice. I have the AAN-FCRA stuff figured out, but this one thing (no advance notice)keeps bugging me. I am afraid I am missing something somewhere.

It's probably in your credit card agreement that you can do that!

Good thought, I will check, but it's just mean. I mean here I am paying as normal on my card, but my score drops below some bank set number without my knowledge. I go to buy gas with my credit card and find out my line is closed. That stinks, but I guess there is notthing prohibiting it.

Update _ I read the agreement and you are right, we can close for any reason, any time without notice unless required by law. It even mentions no liability for automatic payments the cardholder may have scheduled.

Wow- I don't like it, but I guess it is permitted.

Don't forget to send your adverse action notice.

Yep, thanks. Here's another thought, on the line reduction, if that puts the cardholder in another pricing tier, do we need to provide a RBPN?

I think that would be a change of terms governed under the 45 day advance notice rule and yes, the RBPN would be required.

Wow- I almost forgot about RBPN! Thanks for all the help, everyone.