Credit Card FAQ
What Is The Procedure To Close A Credit Card Account?
There are many reasons as to why a person would choose to close a credit card account. It could be that the card was lost or stolen or that the person found a better credit card with lower interest rates. Either way, throwing the credit card in the trash is not the way to do it. Closing a credit card involves following standard procedure. Doing it in the systematic prescribed way is to make certain there are no errors or misunderstandings between you and the credit card company or on your credit reports. Closing the credit card account generally involves three steps that if followed will result in a clean closure.
Step 1 – Notify The Card Issuer By Phone
This step is the easiest. Call the telephone number printed on the back of the credit card that is to be cancelled. Confirm the status of the account and do not forget to check with the customer service representative that the balance on the account is zero. It is recommended that you pay off the balance before making this call. Notify customer service that you want to close the credit card account. Most customer service executives are trained to try to hold on to your business. They will offer you lower interest rates, special deals – it is up to you to hold firm on your ground. Always get the name of the customer service representative you spoke with as well as the name of the person to whom you should write a letter requesting the closure of the account.
Step 2 – Follow Up In Writing
Writing the letter is easy when you know exactly what the correspondence needs to say. The things that have to be in the letter to close the credit card account are:
- I am closing my credit card account
- I want the credit report to show that the account has been canceled on the customer's request
- Your full name, address, and account number must be stated in the letter
- Place the destroyed credit card in the envelope with the letter
Remember to send the letter by Certified Mail and request a return receipt. Save a copy of this letter in a file that is marked for credit card account closure correspondence. Other things you can do to ensure the closing of the credit card account is to mail a copy of the check used to make the final payment. While this is not strictly necessary, definitely keep a copy of the check in your files.
Step 3 - Get A Copy Of Your Credit Report
Closing a credit card account takes time. It may take a month or so before the account is officially closed. After about 30 days of sending the letter, request a copy of the credit report from all three credit bureaus. Make sure the entry in the credit report reads "Account closed at customer's request." Make absolutely sure that is does NOT read "Closed by creditor."
To close the credit card account, go through the above process. If at the end of it, there is a problem in the credit report, go through the entire process again. Call customer service and explain the mistake. Write them a letter requesting that the error be rectified and send it with a copy of the original letter. Check the credit report again after 30 days.
A Few Things To Remember
Thousands of people close credit card accounts everyday. Credit card companies receive heavy correspondence on a daily basis. Remember, old credit is always good credit, so think twice before closing a credit card account that you have had for years. Keep copies of all correspondence including the return receipts of your letter.
When it comes to closing the credit card account, the key thing to remember is that it will take time. Once the credit card account is closed properly, it will not affect your credit score negatively.
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