Closing a credit card is straightforward, but the timing and method matter for your credit score
You can close a credit card by calling the issuer's customer service number on the back of your card, requesting closure, and confirming the account is marked closed. The issuer will typically ask why you're leaving and may offer incentives to stay. Once you confirm closure, the card stops working when ready. However, closing a card affects your credit in ways that take months to fully settle, so the order in which you close cards — if you have multiple — and when you do it relative to other financial moves shapes the damage.
The main risk is your credit utilization ratio: the percentage of your total available credit that you're currently using. If you close a card with a high credit limit, your available credit shrinks, and your utilization ratio climbs even if you haven't charged anything new. A utilization ratio above 30% typically lowers your score. The second risk is account age. Closed accounts stay on your credit report for up to 10 years, but they stop aging, which can lower your average account age over time. Both effects are temporary — utilization rebounds as you pay down balances, and the account's age history remains — but they can cost you 10 to 50 points for several months.
Key Takeaways
- Call the card issuer's customer service line to request closure; the process takes minutes and the card stops working when ready.
- Pay off the card's balance before closing it, because interest charges continue to accrue on a closed account until the balance is zero.
- Close cards with the lowest credit limits first if you're closing multiple cards, to minimize the impact on your utilization ratio.
- Your credit score typically recovers within three to six months of closure, assuming you keep other accounts in good standing.
- Request written confirmation of closure and check your credit report 30 days later to verify the account shows as closed.
Pay off the balance before you call
Closing a card with an outstanding balance is possible, but interest continues to accrue until the balance reaches zero. You'll receive monthly statements and must continue making payments. This extends the time the card affects your credit and costs you money in interest charges that you could avoid by paying first.
If you can't pay the full balance when ready, pay as much as you can before closing. Some people close a card, then realize they still owe money and have to contact the issuer again to reopen it or arrange a payment plan. It's simpler to clear the balance, then close.
Close cards with the lowest limits first
If you're closing multiple cards, the order matters. Closing a card with a $2,000 limit has less impact on your utilization ratio than closing a card with a $15,000 limit. Start with the lowest-limit cards and work upward.
For example: if you have three cards with limits of $2,000, $5,000, and $10,000, and you're currently using $3,000 across all three, your utilization is 15% ($3,000 ÷ $17,000). If you close the $10,000 card first, your utilization jumps to 30% ($3,000 ÷ $10,000). If you close the $2,000 card first, utilization only rises to 18% ($3,000 ÷ $15,000). The smaller hit recovers faster.
Request written confirmation and monitor your report
After you call and request closure, ask the representative to send you written confirmation that the account is closed at your request. This protects you if a dispute arises later — for instance, if the issuer reports the account as closed by them rather than by you, which can look worse to lenders. Keep the confirmation email or letter.
Check your credit report 30 to 60 days after closure to verify the account shows as closed. You can view your report free once per year at annualcreditreport.com, which is the official site run by the three major credit bureaus. If the account doesn't show as closed or shows as closed by the issuer, contact the bureau in writing to dispute the reporting.
Understand the timing of the credit score impact
Your credit score typically drops 5 to 50 points when ready after closure, depending on how much of your available credit you were using and how old the account is. Older accounts that you've maintained in good standing for years cost more points to close than newer cards. The drop is steepest in the first month.
The score usually recovers within three to six months if you keep your other accounts in good standing — meaning you pay on time and keep utilization low. If you close a card and then miss a payment on another account or run up balances elsewhere, recovery takes longer. The closed account itself stays on your report for up to 10 years, but its impact on your score fades after about six months.
Consider downgrading instead of closing
Some issuers offer the option to downgrade a card to a different product rather than close it entirely. For example, you might downgrade a premium card with an annual fee to a basic card with no fee. Downgrading keeps the account open and active, which preserves your available credit and account age without the score hit of closure.
Downgrading is worth exploring if you want to stop paying an annual fee but don't need to eliminate the card entirely. Call the issuer and ask whether downgrade options exist for your card. Not all issuers offer this, but many do.
What happens to rewards points and cash back
Rewards points and cash back balances are typically forfeited when you close a card, though policies vary by issuer. Some cards allow you to redeem points before closure; others let you keep points for a limited time after closure. A few issuers let you transfer points to another account.
Before you call to close, log into your account and check the terms for what happens to your rewards. If you have a substantial balance, redeem it first. If the issuer allows transfers, do that before closure. Once the account is closed, the issuer's policy on points becomes harder to challenge.
Frequently Asked Questions
Will closing a credit card hurt my credit score?
Yes, temporarily. Your score typically drops 5 to 50 points when ready after closure because your available credit shrinks and your utilization ratio climbs. The impact is usually strongest in the first month and recovers within three to six months if you keep other accounts in good standing.
Can I close a credit card with a balance?
Yes, but interest continues to accrue until the balance is zero. You'll receive monthly statements and must keep making payments. It's simpler and cheaper to pay off the balance first, then close.
How long does it take to close a credit card?
The phone call takes about five minutes. The card stops working when ready. The account appears closed on your credit report within 30 to 60 days. Request written confirmation so you have proof of the closure date.
What happens to my rewards points when I close a card?
Most issuers forfeit unused points when you close an account. Check your card's terms before closing to see if you can redeem points first or transfer them to another account. Some issuers allow a grace period to redeem after closure, but policies vary.
Should I close old cards or new cards first?
Close new cards first if you're closing multiple cards. Older accounts have more impact on your credit score because they demonstrate a longer history of responsible use. Closing a newer card causes less damage than closing an account you've held for years.