How to cancel a credit card

Image | Visa credit card Oregon State Credit Union


How to cancel
a credit card

Did you know there are risks
to canceling a credit card?

When you close a credit card, you can impact your credit utilization ratio (the amount of credit you are using compared to the amount of credit available to you). You might also affect the length of your credit history, depending on how long you have held the card you are canceling.

Despite these risks, there are times when canceling a credit card is the wisest course of action. If you have decided to cancel a card, think about which cards to cancel, then take steps to minimize credit score damage.


Part 1
Carefully consider which cards
you want to cancel

  • Don’t close all your cards
    Closing multiple cards will weaken your credit score noticeably. Close only the cards you absolutely must.
  • Don’t close cards before a major loan closure
    If you’re about to buy a car or apply for a mortgage or home equity loan, you need your credit score to be at its best. If you can, delay closing any credit cards until after you have closed on the loan.
  • Don’t close cards with favorable terms
    Close the cards that cost too much to keep, such as those that charge high interest rates.
  • Don’t close cards you’ve had for a long time
    The length of your credit history is considered when calculating your credit score, so don’t close any accounts with a long, favorable credit history.
  • Increase the limit on the cards you’re keeping
    If you’re closing an account with a $1,500 limit, you can off-set that and possibly maintain your credit utilization ratio by increasing the limit on your other cards by the same amount.

Part 2
Follow five steps: be sure
you have closed the account.

Canceling a card involves more than cutting it into pieces. You need to:

  1. Pay off the balance
    If you’re carrying a balance you may need two “payoff” months. Once you have paid the balance on the card, wait one more month to make sure there are no lingering charges or residual interest to be paid.
  2. Call the company
    Look on the back of your card for the customer service number. Confirm that the balance on your card is zero. Tell them you want to close your account, and that you want your account to reflect that it was closed at the customer’s request. Finally, ask for an address where you can send a follow-up letter.
  3. Send a short cancelation letter
    This is insurance in case the customer service representative made a mistake. The letter should include your name, address, phone number, account number and the date of your phone conversation. Again, state that you want the account to reflect it was closed at the customer’s request.
  4. Wait a couple of months
    After a couple months check your credit report to make sure the account was closed. If it hasn’t been closed, repeat steps two and three.

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  • PO Box 306
  • Corvallis, OR 97339
  • Phone: 800-732-0173

Routing number : 323274270