How to Cancel a Credit Card the Right Way

How to cancel a credit card is, in and of itself, pretty simple. Just call the credit card issuer, patiently wait while the customer service representative tries to talk you out of it, and then politely reaffirm that you’re moving on.

Really, it’s like any other breakup. 

But like all breakups, closing a credit card account shouldn’t be done in haste. And if you do ultimately decide to close, it’s better to go the responsible rather than reckless route.

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  • Consider closing a credit card if it has a high annual fee or you’re struggling to control your spending
  • It may be unwise to cancel if you’re about to apply for a mortgage or auto loan
  • Instead of canceling, you can distance yourself from the card, switch to a different card from the same issuer, or negotiate its annual fee
  • If you’re certain that you’d like to cancel, it’s a simple process that can be handled over the phone, in a branch, via mail, or possibly online

How to close a credit card

Closing a credit card can be completed in six steps:

1. Check your credit score

Closing credit card accounts can damage your credit scores (more on that below). Some can endure a temporary credit hit, but even a minor drop can be significant for those with weaker credit.

If you’re planning to apply for a major loan soon, your credit score might be the deciding factor in whether your application is approved. And your score has a direct influence on your overall borrowing costs as well.

If homeownership is within your sights and your score is less than 757 (the average FICO score for mortgagors), consider keeping your credit card account open for now.

2. Move automatic payments 

If you do decide to close the credit card account, you’ll need to cancel recurring payments and set them up with another payment method. 

Go through your card statements for the last 13 months and note each recurring payment you see. That way, you won’t forget any monthly or annual recurring charges and risk losing a critical service or having an account sent to collections. 

3. Redeem rewards

If your credit card is co-branded with an airline or hotel chain, any points you’ve earned will likely be safe even if you cancel your credit card. But if your credit card rewards are tied to the card issuer and its in-house rewards program, you may be given a limited window of time after closing your card. For instance, 90 days — to redeem your points before they disappear into the ether.

The better-safe-than-sorry approach is to redeem all your points before you close. And if your credit card company gives you bonus points or rewards you with another valuable benefit on your annual card anniversary, consider closing only after you’ve reached that milestone.

4. Pay your balance

Although you can close a credit card while it still has an outstanding balance, interest will continue to accrue on that balance, and you’ll need to continue making on-time payments. Paying the balance off before canceling a credit card eliminates the possibility that you’ll miss a payment and take a hit to your credit scores. 

If you don’t have enough money to pay off the balance in full before canceling a credit card, consider transferring the outstanding debt to a card with a 0% annual percentage rate (APR) promotion. This will give you more time to pay the balance off without having to worry about additional interest charges.

5. Contact the credit card issuer

How to cancel a credit card will vary from issuer to issuer, but you can likely cancel credit card accounts through a few different channels:

  • Online: Not all card issuers allow you to cancel online. But those that do may provide a form you can fill out on their website or offer a live chat where you can cancel a credit card.
  • Phone: This is the most intuitive cancellation process, and it shouldn’t take longer than a few minutes. Be prepared for the customer service representative to provide some sort of special offer (which may be worth hearing out) in a last-ditch effort to keep your business.
  • Branch: It may be convenient to handle canceling a credit card in a brick-and-mortar branch if your credit card company has them and there’s one nearby. But keep in mind that it’s likely going to be harder to say “no” to an actual person sitting across a desk.
  • Mail: If you’re not in a rush and you’d like to dust off some envelopes, you can close a credit card via old-school post. You may want to send your request as a certified letter so you can ensure it's received.

However you make the request, always ask the issuer to send written confirmation of the closed account, including information about any lingering amounts owed. This will alert you to residual interest that may have been charged between your last billing cycle’s closing date and your last payment.

If the confirmation can only be sent via mail, double-check that the issuer has your current address. Once you receive the confirmation letter, take a photo and save it. 

6. Confirm and dispose

Wait 45 days and allow the card issuer to update your account info with each credit bureau. Then, request free copies of your credit reports to ensure the card is marked as “closed.”

When your card still shows up as being active on any of your credit reports, or if a report indicates there’s still a balance on the card after you paid it off, file a dispute with the relevant reporting agency. 

If it is made of plastic, you can prevent credit card fraud by cutting it up with household scissors. Metal may have originally been mailed to you with a prepaid return envelope for disposal. Otherwise, you can return metal credit cards to a branch or mail them to your card issuer. You can also get in touch with a crafty artist or jeweler friend and see if they can lend you a pair of tinner snips.

Does closing a credit card hurt your credit?

Closing a credit card can affect three key credit score factors.

Credit mix

The best credit scores are awarded to consumers who have both revolving credit products, like credit cards, as well as installment products, like a mortgage or auto loan. 

If you cancel your only revolving credit product, that makes the mix on your credit report less diverse and hurts your credit score.

Credit utilization

Your credit utilization ratio refers to the balances you have on revolving credit accounts. It is relative to the combined available credit across your credit accounts. A credit utilization ratio above 30% generally harms credit scores; it's a crucial component in all credit scoring models.

Closing a credit card automatically reduces your available credit limit, which increases your credit utilization rate and can potentially damage your scores. 

Credit history length

Credit scores factor in the ages of all accounts on your credit report. Your oldest, newest credit account, and the average age of all your accounts. The older those are, the better your scores will be. So you should always think twice before canceling one of your oldest cards.

Woman cutting credit card with scissors. Guide to alternatives to closing a credit card.

Alternatives to closing a credit card

Thomas Nitzsche is a financial educator for the nonprofit credit counseling agency Money Management International (MMI). He notes that there are potential benefits to keeping a credit card open. Even for those who have struggled with credit card debt historically. “Due to the negative credit scoring impact, we don’t always advise closing a card. Credit cards also provide protections and rewards that other payment methods may not,” says Nitzsche.

Before canceling a card to control spending or cut annual fees, explore options to address these issues without losing card advantages.

Build barriers to prevent overspending

Nitzsche suggests creating spending impediments if you’re worried about misusing your card. “We might encourage a client to make it harder for themselves to impulse-buy,” he says. “Some of our clients have even gone as far as to freeze their cards in ice.”

If creating a credit card popsicle isn’t your style, there are less drastic measures at your disposal as well. “These might include not carrying a credit card on your person. Not linking your online shopping apps to a line of credit, or setting a very low daily spending limit on the card,” says Nitzsche. 

Negotiate your credit card's terms


If canceling is due to high annual fees or APRs, communicate these reasons to the issuer's customer service representatives. They might be willing to reduce the card’s interest rate or waive its annual fee for a year. 

Downgrade to a different credit card

Trying to trim your budget? Ask your issuer about changing products to a no-annual-fee credit card. That move is unlikely to affect your credit score because:

  1. Your utilization won’t change, provided you get the same credit limit for the new card.
  2. Changing products instead of closing the account keeps your credit mix and history length stable, minimizing potential negative impacts.

FAQs

Is it bad to cancel a credit card?

It isn’t bad to cancel a credit card if you’re trying to get out of a credit card debt and efforts to curb your spending have been unsuccessful. But closing a credit card may be bad for your credit score, particularly if the credit card is the only source of revolving credit you have, it’s the oldest account on your credit report, or closing it will push your credit utilization ratio above 30%.

What happens when you close a credit card?

When you close a credit card, you’ll receive your final card statement and you’ll no longer be able to use the card to make purchases. Your credit reports will mark the account as closed. If closed in good standing with a history of on-time payments, it remains for up to 10 years.

Can I reopen a closed credit card?

You may or may not be able to reopen a closed credit card, as the decision to reopen is ultimately at the card issuer’s discretion. Issuers are more likely to reopen a card if it closed in good standing, but less likely if closed for delinquency or agreement violation.

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I'm an award-winning lawyer and personal finance expert featured in Inc. Magazine, CNBC, the Today Show, Business Insider and more. My mission is to make personal finance accessible for everyone. As the largest financial influencer in the world, I'm connected to a community of over 20 million followers across TikTok, Instagram, YouTube, Facebook and Twitter. I'm also the host of the podcast Erika Taught Me. You might recognize me from my viral tagline, "I read the fine print so you don't have to!"

I'm a graduate of Georgetown Law, where I founded the Georgetown Law Entrepreneurship Club, and the University of Notre Dame. I discovered my passion for personal finance after realizing I was drowning in over $200,000 of student debt and needed to take action-ultimately paying off my student loans in under 2 years. I then spent years as a corporate lawyer representing Fortune 500 companies, but I quit because I realized I wanted to have an impact; I wanted to help real people and teach them that you can create a financial future for yourself.

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Our aim is to help you make financial decisions with confidence through our objective article content and reviews. Erika.com is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as MileValue.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. This in no way affects our recommendations or article content.

Advertiser Disclosure

Our aim is to help you make financial decisions with confidence through our objective article content and reviews. Erika.com is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as MileValue.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. This in no way affects our recommendations or article content.

Advertiser Disclosure

Our aim is to help you make financial decisions with confidence through our objective article content and reviews. Erika.com is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as MileValue.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. This in no way affects our recommendations or article content.