How To Cancel A Credit Card? [A Step-by-step Guide]

How To Cancel A Credit Card

If you decide to stop using your credit card or cancel the service, few necessary steps and procedures are needed which may seem complicated. Although the steps are quite easy you still may want to know the in-depth procedure and details of the entire process.

In this article, I will guide you with the simple and smartest way to cancel your credit card. Some user’s cancel the credit card service without exactly knowing the damages and loss that can occur upon stopping the service. 

Here, I will provide you a step-by-step guide on how to cancel a credit card. So, follow these 5 necessary steps because it will save you from all the unnecessary losses because this is the smartest way to cancel a credit card: 

5 Necessary Steps To Cancel Your Credit Card:

Ideally, it is recommended not to close the service of your credit card by any means. However, if you wish to do so, following the right strategies and steps will keep you safe. My providing steps will help you to do it smartly:

Here are the 5 necessary steps to cancel your credit card:

1. Talk To Your Issuer:

Call the customer service number that is listed on the back of your credit card or from their websites. Provide your 16 digit number to the representative and give your reasons to cancel your card. If you do not have the physical card with you, the representative’s will trace the credit card using your social security number.

The representative will try to influence you to keep using the service, but let them know that it is your decision. Make sure to request the representative a written confirmation that the account is not getting closed automatically but by the user’s decision.

In order to avoid any unnecessary trouble, ask the representative to provide you the address where you can send a formal application to cancel your credit card service. Also, note down the date and the representative’s name for future references.

2. Use All Your Rewards:

Credit card companies make it very difficult to transfer or use your unused redeem points and rewards once the cancellation process starts. So use all the points and redeem your rewards, before you apply for a cancellation process. 

For example, If you have 20,000 points on your credit card and do not have any other American express cards the points will be just gone.

Use the points and rewards on anything you can and make the most of it. If you cannot physically find a way to travel and gain the most value out of your points, use the points on e-commerce sites like Amazon, Ebay etc. You surely do not want to miss those points you have acquired all these years.

3. Clear Your Debts And Transfer Your Balance:

You must have some valid reason to cancel your credit card, but before you start with the process clear all your debts and the remaining balances. Make sure your account has no unpaid balance, because the issuer will only accept your cancellation request when you have a 0 $ dollar balance. 

Even if you pay the full amount on your last statement, there could still be a small balance if the issuer charges interest. 

Check thoroughly with all the hidden charges of your issuer and clear them accordingly before you proceed with your application. Transfer your balances to a new account if necessary and close all the auto payments from your current account. 

4. Examine Your Credit Report:

After accepting your cancellation request by the issuer, it will take some time to completely close your account. There are few things you must examine during the ongoing process. Make sure to verify that your account is closed upon the user’s request and not by default or by the bank.

Default closing of your account will hamper your credit score in the future. If you see your account is closed by the bank, immediately contact a representative of your bank and resolve the matter. 

You can check your report online for free from the site AnnualCreditReport.com. The service is only available once for free from the external bureaus (Equifax, TransUnion and Experian).

5. Send A Formal Application To Your Issuer: 

It is always better to stay safe when it comes to any matter involving money. Even if you speak to your issuer’s representative, send a formal letter requesting the cancellation of your service. This is very important as sending the letter to your issuer means you have actual evidence of your request.

Make sure to provide the reasoning for terminating the service along with your personal information: name, address, social security number, account number etc. 

Another tip is to send your letter through a verified mail service and request a receipt from the issuer to prove and make sure that they have received your letter. You can also request a confirmation letter from your issuer, that your account was closed with zero balance. 

Commonly Asked Questions:

What Is The Right Way To Dispose Of Your Credit Card?

Well, there are actually 2 ways to properly dispose of your credit card. Follow the right procedures to prevent yourself from fraudulent activities:  

  • Dispose the card by using a scissor and cut it into pieces. Make sure to destroy and cut all the information including your 16 digit card number and personal information. 
  • You can also directly put your card in a shredder machine to destroy the card into pieces.
  • Some cards are made of metal like the American Express Gold Card. In that case, it is better to return your card back with an envelope to the issuer. The issuer will take full responsibility for disposing of the card. Use a verified or certified mail service with a return receipt that your issuer received the card. 

What Happens If You Cancel Your Credit Card With An Annual Fee?

Well most of the issuers charge the annual fee after the credit card is approved and issued to you. Some of the issuers do not charge an annual fee for the first 1.5 years.

So if you close your account, make sure to check if you have already paid the annual fee. Closing the account after paying an annual fee means you have already paid for the services but did not use them.

Bottom Line:

You may have your personal reasons to stop using the credit card. But the important thing is to know the right procedures to cancel your card without affecting your credit score and stay trouble free.

If you find the provided information useful, feel free to give your valuable feedback in the comments section. If you also have any questions regarding this matter, just write to us. 


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