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It seems that there is information everywhere when it comes to opening a new credit card, but cancelling a credit card isn’t so simple. Contrary to popular belief, just taking a scissors to your credit card, doesn’t mean that the credit card is cancelled. Read on to see some ways that you can effectively cancel a credit card.
- Make sure you cancel accounts one at a time. This is important if you have more than one open account that you would like to close. Make sure the first credit card is fully closed before you close the second card. You should cancel credit cards with the highest annual fees and interest rates first. Then you should cancel newer credit cards, before you cancel old credit cards. If you cancel your older credit cards it will have a negative affect on your credit history, as the credit reporting agencies look at how long you have had your credit cards when factoring your credit score.
- Transfer/Remove the Balance. Get rid of the balance on the credit card that you want to cancel, by transferring the balance using a zero balance transfer credit card. These cards usually have introductory offers where no interest is required to paid on the balance. Or you can pay off the balance with at the current credit cards interest rate. Don’t try to cancel a credit card with an existing balance, as the credit card issuer will more than likely charge you extra penalty fees.
- Speak to Someone. Call the credit card issuer if you are looking to cancel your credit card. Online transactions have a higher incidence of error. With something as important as your credit card and your finances, it’s best to speak to an actual person who knows how to cancel your card. One downside of calling the credit card representatives is that they are usually trained on how to get on-the-fence cancelling consumers, to stay on board. So if you are serious about cancelling your credit card, keep a strong mind, and don’t be swayed.
- Write it Out. When your account has been cancelled, make sure you get written confirmation for your records. Also, it may be in your best interest to write a note out to the credit card issuer documenting the fact that your credit card has been closed and make a copy for your records. The letter should state that you were a former accountholder and you were following up to confirm that your account has been cancelled.
- Watch your statements. Honestly, you should be always be paying close attention to your credit card statements and balances. But any new changes resulting from the cancelling of this credit card should show up in four to eight weeks. Use your credit card statement to make sure that the account was closed and no other charges go through on that card.
Once you’ve done all of those things, the credit card in question should be successfully closed, and you can feel free to cut that card into itty-bitty pieces if need be. Each person has a different reason as to why they cancel their credit card, but if payments are becoming to hard to keep up with, or the interest rate is too high, consider closing that credit card and moving towards a lower interest rate credit card.