Today, There are various reasons Why you could decide to cancel your credit card, as you want to reduce the number of credit cards, try to count less on credit, divorce or discovery of another card that responds better to your requests.
Whatever your motivation, you must be aware of the cancellation procedures for your credit card to avoid making mistakes. Because the cancellation of a credit card can be more stressful than necessary. Its procedures force you to contact the credit card issuer, which can take more time to respond and check several documents and reports.
What are the reasons for the closure / cancellation of a credit card?
1. Divorce:
It often happens that an ex bitter accumulated excessive charges on a joint map.
This is only one of the reasons why most divorced people close their accounts of joint credit card after a divorce or legal separation.
The effective realization of this helps to constantly terminate a joint account and to withdraw from responsibility. In addition, it is advisable because it can protect your credit ratings from future damage to your former spouse’s debt.
2. Increase in annual costs:
You can consider canceling a card if the transmitter is charged with heavy annual costs for a service that you never use. However, expenses could be justified if the account offers advantages beyond annual costs, such as travel credits and bonuses.
3. Alternatives with better awards:
Maybe you have asked for a credit card in the hope of winning awards, but you now have a second reflection. Worse, you could miss incentives because you discovered a different card by offering better. When you have made several comparisons and determined that the latter is superior, it is time to continue and change cards.
4. Loss of self -control:
Some people are unable to resist the urge to use their credit cards. Credit card overeating can lead to poor credits that increase daily due to the high interest rates of the APR, potential delay fees and penalties to exceed the credit limit. The closure of your credit cards, even those with unpaid sales is a wise option for these people who lack self -control.
How to cancel your credit card?
You can contact your credit card transmitter and cancel your credit card at any time, but there is a procedure that you need to follow to avoid missing anything. Who is:
- Cancellation of recurring payments:
Before canceling, transfer automated payments / purchases to another credit card. This will not guarantee any disruption for your service or your fines unpaid on your account.
- Cancellation of any waiting payment:
Make sure to deactivate payments, subscriptions and services pre-authorized by credit card.
If you are the type that uses your credit card to make pre-authorized payments, contact the company you pay and establish new payment agreements or interrupt the service. If you don’t, you will be billed for these services. In addition, even if you terminate your credit card account, your costs may increase and charge interest until you pay them.
- Erase your balance:
You will not be able to cancel your credit card if you still have money. This is why you must verify that the amount of your credit card is zero before canceling your credit card.
If you have a negative balance (either too paid or recently received a refund), you can ask your credit card company to send you a check.
- Alert your authorized users:
Not all authorized users will be able to use the credit card after closing. Give them an opinion in advance that the account is closed to spare them the humiliation of the refusal of their credit card in the register when they end up using it.
- Available points repurchase:
Make sure you use your credit card points before canceling your account. If you don’t do it, you finally lose them when your account is closed. Therefore, try to exchange or exchange these points for things like gift cards or declaration credits.
Now, once you have followed all the above requirements, you can cancel your credit card account by following these steps:
1. Contact your credit card transmitter:
Most credit card companies will allow you to deactivate your card online, telephone or in person from the bank.
However, you can contact your credit card company by phone or mail and request the cancellation of your credit card account. The customer service phone number can be found on your credit card, your monthly statement or the issuer’s website.
If you wish to contact the issuer by letter, the postal address may be found on your monthly statement or on the issuer’s website.
2. Cancellation confirmation:
After canceling your card, be sure to request written confirmation.
When you do, your credit card company will give you a letter confirming that your credit card has been closed. After receiving the confirmation mail, you can continue to destroy your credit card. In addition, just in case, be sure to store a copy of the confirmation mail.
3. Check the credit card statement:
Even after closing your account, some recurring transactions can always be reflected on your credit card statement. It is always possible that the cancellation has not been implemented correctly. Therefore, you must check the closure via your updated credit card declaration.
4. Check your credit report:
Even if you have already written a written confirmation that your account has been canceled, you must check by checking that closing your card account is displayed in your credit report. Give the company that has issued your sufficient credit card to update credit offices. As a rule, it takes around 30 days.
Does the cancellation of my credit card affect my credit rating?
There are certain risks to be considered when canceling your credit account which may have an impact on your credit scoring:
- Credit use ratio:
The closure of a credit card account could harm your credit use ratio, potentially reducing your credit scoring. The amount of renewable credit that you are currently using divided by the total amount of renewable credit you have is your credit use ratio.
In other words, it is your existing debt divided by your credit limit indicated as a percentage. It is determined using your credit reports. The more credit you use (depending on your reports), the lower your credit scoring.
However, before closing a credit card account, you must repay your entire debt and erase your balance. Indeed, the closure of a credit card will not reduce your credit scoring if all your credit cards have balances of $ 0 on your credit reports.
- Duration of credit history:
The duration of your credit history is another factor that affects your credit scoring. If your other credit card history is very recent, your credit scoring may suffer if you decide to cancel your oldest credit card.
It is not always a good idea to close the accounts immediately after having opened them. The closure of your account prematurely could point out a risk for lenders, which can have a negative effect on your credit scoring or the possibility that another lender accepts you.
Finally, the many types of credit to which you have access can be important, even if it has only a negligible impact on how your credit scoring is calculated.
For example, if you close your single credit card, the credit office will have to base its score on your other credit cards. Therefore, having many different credit cards is beneficial and canceling it with a negative impact on your credit scoring.
What can you do to cancel a credit card without damaging your credit?
There is a way to cancel your credit card without damaging your credit. Nothing changes your credit scoring when you change credit cards. Thus, you cannot generally go to a small set of specific cards in the portfolio of a specific credit card company. However, this is only true for certain specific credit card issuers.
For example, suppose you have a primitive money delivery card issued by banks, you can go to a credit card with cashback and at no cost. Although technically, you do not cancel your credit card, you get a new one without affecting your credit score.
Although the change of credit cards may appear an unusual tactic, this can be practical for consumers who wish to continue to receive welcome bonuses without asking for new cards.
Can you close a new credit card that you have just obtained?
It is possible to close a credit card that you have recently opened, but keep in mind that the impact on your credit score that has occurred when you have created the account will remain in force.
In addition, if you have already obtained the welcome bonus and wish to cancel immediately, the credit card company will probably not be impressed. Because it would give the impression that you are an irrefaculated customer. They could report your account, which forbids you to receive future bonuses and perhaps be accepted.
Last words
Avoid terminating a credit card account without justification. If you manage your credit cards properly, having a number of them will not necessarily reduce your score considerably. However, to minimize or eliminate any damage to your credit scoring, if you have to cancel a card, do your best to repay your credit card sales before doing so (ideally zero).
Also keep your credit portfolio as strong as possible when canceling a card. Because this could avoid damaging your credit scoring in various ways.
