credit cancelled

i had a $300 overdraft line of credit account. I paid off my sears charge 2 years ago but they keep reporting it as 60 days late on my credit report. i am disputing it with the credit bureau. my question since the bank extended me credit isnt it against my rights for them to just cancel it on me? i had this line of credit for 20 years and always paid it back and never missed a payment. i have really great credit and have worked hard to keep it that way except for this one error. also since the bank cancelled the line of credit this will now appear on my credit report as negative credit. i am in ohio.