How to cancel your credit card
Here's everything you need to know to close your account safely and easily.
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Here are the steps you need to take in order to safely close your credit card account and cancel a credit card. Learn more about the process in our guide below.
How to cancel a credit card in 8 easy steps
- Pay the outstanding balance.
Avoid closing a credit card with a balance. If you try to close an account with an outstanding balance, the bank could increase the interest rate or demand full and immediate payment. If you plan on transferring your balance to a new card, wait until the transfer has gone through before your close the card.
- Transfer any reward points.
If your card offers rewards, redeem or transfer them to another eligible account before you request to cancel the card. Once you close the account, all unclaimed points are forfeited.
- Cancel direct debits.
To prevent reactivating your card, cancel all existing direct debits linked to your credit card. Even if you’ve requested for an account to be closed, a direct debit could reactivate a canceled card.
- Cancel your credit card by phone or online.
Once you’re ready to cancel your card, the provider will either required you to call directly or cancel online. Most providers want to talk to you to offer lower APR or annual fees to get you to stay with them. So if you’re dead set on canceling the cards, be ready to stand your ground. Once you cancel, make a record of the date, time, and name of the representative you speak with.
- Cancel your card in writing.
Other providers make it even harder to cancel by requiring that you send a written request. Ask for the address over the phone, and include your credit card number and account number in the letter. You should receive a letter confirming the closure of the account.
- Check for future statements.
Try to log into your account or go through your credit card statements following your request to make sure that the card is definitely canceled.
- Destroy your credit card.
Cut the card into tiny pieces to make it impossible for anyone to piece it back together. You can even discard the pieces at different times or places.
You should receive a cancellation confirmation by mail or email. If you don’t, follow up with your lender using details from your first phone call.
What number do I call to cancel my credit card?
Here’s a list of some of the most popular credit card providers’ phone numbers. You can also call the number on the back of your credit card.
|ATB||1-800-332-8383 or 1-844-392-9359|
If your credit card provider has physical branch locations, you can visit a branch and attempt to cancel the card in person.
What to do before you cancel a credit card
Here are a couple other things to consider before closing your account:
- Note the annual fee.
Check when your annual fee is charged and if it will affect your final payment.
- Pay off everything you owe.
If you have a balance on your card, it means you still owe money to your provider. Clear your balance to close your card. A balance transfer credit card can help you move the balance off of the original card so that you can close it.
- See if you can negotiate better terms.
Consider why you’re closing your card, and think about negotiating with your card issuer to get a better deal. Don’t want to pay an annual fee or want a lower interest rate? Just ask, and your issuer might oblige.
- Consider your credit.
Closing your account can decrease your total credit, and your credit utilization ratio may go up. Also, positive payment history you’ve accrued with your card won’t factor as heavily once you close your card. As a result of these factors, your credit score may decrease. Keep this in mind if you’ll be applying for another credit product in the near future.
- Update your credit card for relevant services.
You may be using your card as a payment method for services that charge you regularly. To avoid interruptions in service, add a different card.
How else will canceling my credit cards affect my credit?
Canceling your credit card can be good if you’re looking to control your spending and get a better grip on your budget. But before you make that move, consider how it can affect your credit.
Just because you cancel a credit card, your payment information doesn’t disappear from your credit report. That can be both good news and bad. If you’ve made late payments or have any other negative information on your credit card, that data stays on your credit report for 6 years. If you’re closing an account with positive account history, positive credit data stays on your credit report for 10 years from when the account is closed. This allows good credit information to stay longer than negative, giving you the change to improve your financial situation.
Credit utilization ratio
Another way that closing your credit card can affect your credit score is changing your balance-to-limit ratio or credit utilization ratio. Credit bureaus are interested in your total credit available and how much of that you’re using. A low ratio is a strong indicator of a good credit risk.
So closing a credit card with a high spending limit and a zero balance could hurt your credit score, especially if you have high balances in other cards or loans. If you want to cancel your card because of an annual fee, offset the ratio by either requesting a credit limit increase on another card or paying off balances on other cards.
Age of your credit card
When it comes to your credit cards, age matters. The amount of time your credit card has been open affects your credit score, and is beneficial if you have a positive credit history. So closing that credit card you’ve had since college can actually hurt your score if you have a positive payment history. If you just submitted your application for a new credit card, you might be able to cancel your card application before you’re approved.
You may be canceling your old card because of high fees, unfavorable interest rates or lack of rewards for your spending. Carefully consider the factors outlined above then follow the steps to cancel your card. If you’re interested in a new card, assess your financial needs to find the right credit card that will prove invaluable for years to come.