How to Cancel a Credit Card

a man learning the how to cancel a credit card and cutting it to pieces with scissors

There are many different reasons you might want to cancel a credit card. Maybe you want to lower your available credit, eliminate the card's yearly fees, or you just don't use it. Whatever the reason, many people are not familiar with how to close a credit card or the implications.

If you’re thinking it’s time to part ways with that piece of plastic, we're here to give some of the essential points to consider when closing your credit card.

When to Cancel a Credit Card

There are some instances when you might want to consider closing your credit card. It might be the right thing to do if you’re facing one of these situations and worth your time to think about.

Resisting the Temptation to Use the Card is Difficult

It's too easy to use a card, especially with online shopping. For some, the emotional reward of receiving boxes with new items on their doorstep can become addictive. The ability to disconnect from the impacts of making an unnecessary purchase with a credit card does become problematic. In this case, closing your account might be a good choice if your spending gets out of hand.

Your Situation Has Changed

Life is filled with unknowns, and your financial or personal circumstances can change anytime. If your income has changed, having unaffordable credit could be uncomfortable. Should you go through a divorce or separation from a partner or spouse, you might wish to separate your finances and close the joint account.

Your Card Benefits or Rate Have Changed

Cards may change their benefits, interest rates, or annual fees, which could make the card less desirable to carry. If your APR has increased or a valuable travel benefit has been removed, closing a card that is no longer used or will cost you more could be tempting.

What Happens When You Cancel a Credit Card?

When you cancel your credit card, it will no longer show as an open card on your credit report, which could have a negative impact on your credit score. Your credit score depends on the factors: credit utilization, payment history, length of credit history, credit mix, and new credit. Each of these factors could see a change when you cancel your credit card, affecting your credit score.

Credit Utilization

The credit bureaus track the amounts owed on all your credit accounts and calculate the amount of your available credit used reflected as a percentage. This percentage is referred to as your credit utilization rate. If you have $10,000 in available credit and $4,500 in balances, your credit utilization rate is 45%.

A lower ratio of debt to available credit is preferable. Your score can be negatively impacted when your balance starts getting closer to the available credit.

Closing your card might raise that percentage if it significantly lowers your available credit. Closing a card with $2,000 of available credit would lower that hypothetical $10,000 to $8,000 of available credit. The $4,500 in credit balances becomes a 56% credit utilization rate instead of 45%.

Payment History

On-time payments are essential to your credit score, which is one significant way a credit card helps you increase that score. If you've been historically making your card payments on time, keeping the card could continue to grow your score by making ongoing on-time payments.

However, if you have historically had problems paying the card on time, closing the card could protect you from further harm to your credit score.

Length of Credit History

The longer you have had an active and responsible credit history, the better. Lenders and credit bureaus like to see you've managed your credit effectively for an extended period.

Closing your card can impact the age of your credit history as that card stops aging. The impact could be more significant if you've had the card for quite some time.

Suppose it is your oldest card; it might be an excellent strategy to keep it open. Closing it will significantly impact the length of your credit history.

If you close the card and replace it with another, you're effectively showing new credit with less of a credit history.

Credit Mix

Lenders like it when they see you are responsible for a mixture of credit types. Revolving credit, like credit cards, and installment credit, like loans with fixed monthly payments, are two primary components of the credit mix.

If your credit card is your only source of revolving credit, closing it removes it from your credit report. With it closed, you have no revolving credit in the mix and no record of responsible card usage. Your credit score could take a hit.

New Credit

Every credit card application results in a hard inquiry on your credit reports, showing a lender checked your credit before deciding to extend credit to you.

Suppose you're closing the card to open a new credit card. In that case, you're adding a new hard inquiry while potentially hurting your score by closing the current card. There could be a considerable impact.

Steps for Canceling a Credit Card

Every financial situation is different. If you’ve thought it over and are ready to cancel your card, following our steps will result in card cancellation success.

  1. Pay Off the Remaining Balance

  2. Some card issuers will let you close a credit card carrying a balance. If there is a current balance on your card, it is best to pay it off and not have to worry about making any payments after the card is closed.
  3. Check Your Rewards

  4. Before you cancel your card, check if you have unused rewards points or cash-back rewards. Depending on the card issuer, you can lose your rewards or benefits when closing the card account. If you have them, use them up. If you have airline miles, cash rewards, or points for any other types of rewards, put them to use or see if there is a way to transfer them to an alternative account. Don't deprive yourself of a free airline ticket or dinner out!
  5. Cancel All Recurring Payments

  6. The last thing anyone wants is their cell phone turned off because they forgot to change the recurring payment source from their now-closed credit card. Missed or late payments because accounts were not disconnected from your old credit card could be frustrating to fix or outright detrimental. Your credit score could be negatively affected or accounts disrupted. Go through your current card's statements, see what payments have a history of automatic deduction, and ensure the payment method is replaced on those accounts before you close the card.
  7. Call the Bank That Issued You the Credit Card

  8. The final credit card cleanup is done, and it's time to cancel. One way to do so is to call the issuing bank or lender. Typically, the number to call is on the back of your card, or the customer service line can be found through an internet search. The customer service representative should access your account and walk you through the cancellation process.
  9. Go Online or In Person to Cancel Your Card

  10. Some credit card holders might be uncomfortable calling in to cancel a card for various reasons. If you're one of those people, it is usually possible to cancel the card at your local issuing bank or online. Canceling your card online could be as easy as going to your account page, accessing the settings, and clicking a button. The website will give you confirmation that the account is now closed. At the bank, any customer service representative should be able to assist you or direct you to the correct party.
  11. Check All Credit Reports

  12. Your credit reports will take a little while to update and show a card as canceled. Give them a few weeks, up to a month, and check them to verify the card shows as closed. If, after some time, the card is not showing as closed, contact the card issuer and ensure they have correctly reported the account as closed. Should it be necessary, a certified letter of cancelation could be used to prove your account should be closed. If you see your card listed as open on a credit report later, don't hesitate to reach out to the credit bureau and request that your report be fixed. Once your credit reports update, checking the impact on your credit from closing the credit card is worthwhile. See where your score is now and set a goal for where you want to be.
  13. Destroy the Card

  14. Now that you've seen proof your card is canceled on your credit reports, it's essential to destroy it physically. Just throwing your card in the trash opens you up to identity theft. So get out those scissors and cut the card up, or let the office shredder do the job for you.

Summing It All Up

Closing a credit card comes with some considerations and steps to take. The most important is to contemplate why you want to close the card and weigh that against the potential to hurt your credit score. It's a move worth serious consideration.

If you determine that closing the card outweighs any potential credit score impacts, pay it off, use your rewards, change your autopayments, and close it.

Do You Need Funds To Pay Off Your Credit Card?

If you want to pay off and close your credit card, Integra Credit might be able to help. Apply through Integra Credit today.


Does canceling a credit card hurt your credit?

It can. Because credit scores depend on the age of your accounts, credit mixture, and credit utilization, it's not a bad idea to keep your card open after it has been paid off.

Can I just stop using my credit card?

Absolutely. You can stop using it and throw it in a drawer, but be aware your account will likely be closed due to inactivity. Usually, this happens 12 months after the balance is paid.


  1. How Often Do Credit Scores and Reports Update | TransUnion
  2. Hard Inquiry: Definition, How It Works, Impact on Credit Score
  3. What Is a Credit Utilization Rate? - Experian
  4. What is a Credit Mix? - Benefits of Credit Diversity | Equifax®
  5. Should You Cancel An Unused Credit Card? | Bankrate
  6. What happens when you cancel a credit card? | ZDNET
  7. How To Cancel a Credit Card the Smart Way | Credit Karma
  8. How to Cancel a Credit Card: A Step by Step Guide
  9. How To Cancel A Credit Card – Forbes Advisor
  10. The Safe Way to Cancel a Credit Card

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