How to Cancel a Credit Card
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Key points about: how to cancel a credit card
To cancel a credit card, you must notify the credit card company, but you’re still responsible for any accumulated credit card debt.
Canceling a credit card can impact your credit score and increase your credit utilization ratio.
A canceled credit card account can stay on your credit history and credit report for up to ten years.
Paying off your credit card balance and canceling the card might seem like a straightforward process — and it can be — but before you call your card issuer to cancel a credit card, brief yourself on a few important points of the cancellation process.
Before you cancel a credit card account
People have a variety of good reasons for canceling credit cards. You may decide you no longer want a credit card with an annual fee, you’d prefer a travel credit card, or you’ve been approved for a credit card with a higher credit limit. But, if you’re canceling just because you have multiple credit cards and you want to clear out your wallet a little, you might reconsider. This is especially true if you have good credit and want to maintain a credit score.
Did you know?
Canceling a credit card can affect your credit score by lowering your total amount of available credit, impacting your credit utilization ratio, and decreasing the average age of your accounts. This is true even for an unused credit card or a rarely used credit card.
Canceling a credit card lowers your total available credit, which increases your credit utilization ratio if you carry a credit card balance on any of your credit accounts. A higher credit utilization rate can lower your credit score.
The age of your credit cards is important, too. If you cancel an old card, the average age of your accounts could decrease, which can also lower your credit score.
Step-by-step guide: How to cancel a credit card
- Pay off your balance. Canceling your credit card doesn’t erase any outstanding balances, accrued interest, or other fees that remain on your credit card account. Be sure to take care of your credit card debt before closing the account. If you haven’t paid off your balance, you’ll need to continue making payments to the credit card issuer after you close the account (and you’ll lose the available credit you may have had.) You may wish to set up automatic payments to pay off the remaining balance before you cancel.
- Use any remaining rewards prior to canceling your credit account. If you don’t want to miss out on accrued points or rewards available on your credit card account through your rewards credit cards, redeem them prior to canceling. You may also be able to cash them in as a statement credit to help reduce your outstanding balance.
- Notify other cardholders that you intend to close the account. If your spouse or other family members are authorized users on your account, be sure to let them know that you plan to close or cancel the card so they don’t continue to make purchases.
- Request cancellation. Contact the credit card company’s customer service department by calling the number on the back of your card and letting them know you want to cancel the account.
- Destroy your card. It’s a good security practice to shred or cut up your card before you throw it away, so the account number is no longer legible. Some credit card companies offer secure disposal options, like mailing the card back in a provided envelope, particularly for metal cards.
Does canceling a credit card impact your credit score?
Canceling a credit card can impact your credit score, which will appear on your credit report. If you want to see the effect, get a copy of your credit report. Approximately one month after you’ve canceled your card, you can access your credit report to confirm that the canceled card information is reflected accurately.
If you see an error, contact the credit bureau to investigate incorrect negative factors against your credit score that appear on your credit report, since they could remain on your credit history.
The canceled credit account will remain on your credit report, can impact your credit score, and may be visible on your credit history for seven to ten years.
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