Sign On
  • Online Banking
    Sign On Form is Loading

Are you tempted to close out a credit card account to better organize your finances, consolidate your debts onto a card with a lower interest rate, or get rid of annual fees? You'll want to use caution when doing so, and take action to minimize the impact on your credit score. Let's look at why you might decide to close a credit card account, the impacts you'll likely face to your credit score, and which cards to close for the best outcome.

Reasons for Closing out a Credit Card

There are a number of reasons someone might choose to close a credit card account. For example, you might close out a credit card to simplify your finances and the accounts you need to keep track of. Or you may also close a credit card if you want to transfer your current high-interest rate balances to a lower interest rate card. This could save you money and potentially help you pay off your debt quicker.

Another reason to close accounts would be to stop or prevent credit card fraud. Any credit card account that has had fraudulent purchases should be closed. You may also consider closing out a credit card that you do not use in order to reduce the amount of credit cards you have. By having fewer cards, there are fewer entrance points for people to steal your numbers for fraudulent purchases.

Considerations to Make Before Closing out a Credit Card

In certain situations, you could gain benefits from closing out a credit card account. However, there are a few details that could negatively impact your finances. For starters, your credit score could decrease — closing an account closes a credit line, which typically means that your credit utilization rate increases. If you do end up closing an account, try to work around this by consolidating credit lines. You'll want to call the card(s) you're keeping and ask them to raise your credit line amount since you've closed other cards. Additionally, be sure to factor in how long you've had the cards you're thinking about closing. Your credit score can be negatively affected if you close an account with a long credit history.

Another thing to keep in mind is that you'll have to change the payment method for any bills that are automatically paid by the credit card you want to close. Otherwise, you could miss a payment. The card would also need to have a zero balance before closing, so be sure to either pay it off completely or transfer the balance to a lower interest rate card.

What Does the Closing-Out Process Look Like?

Did you decide that you'd still like to close out your credit card, despite the drawbacks of doing so?

You can close a credit card account at any time, even if you opened it recently and process is fairly quick. Use the following steps:

  1. Check for Unused Reward Points: You don't want to lose any reward points you've earned, so go ahead and use them up.
  2. Set Up New Automatic Bill Pays: Look over your last few statements, and set up new bill payment methods where needed.
  3. Pay off the Balance: Pay off the old balance (or do a balance transfer to another card), plus any new charges you've made since your last statement.
  4. Call the Cancellation Department: Talk to someone in the cancellations department by using the phone number on the back of your card.
  5. Check Your Credit Report: A few months after you close the account, verify that it was actually closed by getting your free credit report.

Considering the steps above before closing credit card accounts will help you to see if consolidating your credit lines and debts into a lower interest rate card is worth it, or if you should figure out a different option.

This information and recommendations contained herein is compiled from sources deemed reliable, but is not represented to be accurate or complete. In providing this information, neither KeyBank nor its affiliates are acting as your agent or is offering any tax, accounting, or legal advice.

By selecting any external link on, you will leave the KeyBank website and jump to an unaffiliated third party website that may offer a different privacy policy and level of security. The third party is responsible for website content and system availability. KeyBank does not offer, endorse, recommend, or guarantee any product or service available on that entity's website.

Call Us

1-800-KEY2YOU® (539-2968)

Clients using a TDD/TTY device:

Clients using a relay service:

Schedule an Appointment

Talk to a Branch Manager in your neighborhood.

Schedule an appointment now

Find a Branch or ATM