Sometimes the decision to close a credit card is easy. The credit card company may not reduce the interest rate. Or maybe your credit card is no longer useful. You may be simplifying your finances and need to release some credit cards. When you are sure that closing your credit card will not impair your credit score, there are a few other things to do before closing your credit card properly.
Make sure you really want to close your credit card
Avoid closing your credit card because you are angry with your credit card company or because you think it will improve your credit score.
If you later say you closed your credit card, you may not be able to reopen it. Before calling a customer service representative to give up your order well, make sure this is what you really want to do.
Use credit card rewards.
When you close your credit card, you will lose all the rewards you have accumulated for credit cards. Use your rewards before you close your credit card to avoid losing them forever. Some credit cards may allow you to transfer your rewards to another credit card with the same program, but confirm that you can make the transfer before closing your credit card.
Change all current accounts.
If you set up an automatic credit card for any service, change it before closing your credit card.
Two things can happen if pepper tries to process an automatic payment against a closed account. A credit card company can reopen your account and process your payment. You can easily miss out on a new credit card fee, especially if you have closed your credit card with zero balance. Or, your credit card company may decline your account.
In the latter case, the payer will hope to pay you and may be subject to additional penalty fees for the delay.
Pay off your balance.
You are not required to pay your balance before closing your credit card, but it is good for your credit score. When you close your credit card while it is still in balance, you are still responsible for making regular minimum payments and will still have interest.
Alert your authorized users.
When your credit card is closed, not all authorized users will be able to use the credit card. Save them the hassle of having their credit card declined at the checkout counter and alert them to close their account.
When you confirm that it is OK to close your credit card, call the credit card customer service department. Follow up with a letter confirming that your account has been closed and check your credit report within a few weeks to confirm that your account was indeed closed.