How to Close a Credit Card Account or Loan
Sometimes, it just makes sense to close an account, even if you face a temporary dip in your credit score. Maybe closing the account will help you control spending, for example, or maybe the card or loan in question is costing you fees or interest that you’d rather not pay. Credit reporting agencies suggest taking a thoughtful approach to closing accounts. For instance, if you’re about to seek a mortgage for a new home, you might not want to close any accounts just beforehand. Canceling multiple accounts should be done in a gradual, planned fashion to avoid sending negative signals to potential lenders.
To close a credit card account, you’ll want to pay off your account balance, redeem or transfer any rewards, and contact your card issuer’s customer service department to request account closure – either by phone or in writing – rather than simply cutting your card in half. Usually, you should receive a confirmation letter in about 10 days.5 To close a loan account, all you have to do is pay off the loan in full. Your lender will generally contact you via mail or email to confirm the loan has been paid off.