Closing a credit card account usually does hurt your credit score, but the damage is temporary and the size of the hit depends on which cards you close and when.
The main reason is that your credit score is built partly on how much of your available credit you are using — called your credit utilization ratio. When you close a card, you lose that available credit, which makes your utilization percentage jump up even if you haven't charged anything new. A higher utilization ratio signals to lenders that you are using more of your available credit, and that typically lowers your score.
The second reason is that closing an account can shorten your average age of accounts, another factor in your score. If the card you are closing is one of your oldest accounts, closing it makes your credit history look younger on average, which can also lower your score.
The good news: both of these effects fade. Your score usually recovers within a few months as long as you keep paying other bills on time and do not run up balances on remaining cards.
Key Takeaways
- Closing a card raises your credit utilization ratio because you lose available credit, which typically lowers your score by 10 to 50 points depending on how much credit you had available.
- The damage is usually temporary — your score often recovers within three to six months if you keep other accounts in good standing.
- Closing an old card can lower your average account age, which also affects your score, but this effect is smaller than the utilization hit.
- If you must close a card, closing a newer account with a small credit limit does less damage than closing an old account with a high limit.
- Leaving a card open with a zero balance preserves your available credit and protects your score without costing you anything.
How much your score typically drops
The size of the drop depends on how much available credit you are losing. If you close a card with a $500 limit and you have $10,000 in total available credit across all your cards, you are losing 5 percent of your available credit. If you close a card with a $5,000 limit, you are losing 50 percent — and that will hurt more.
Most people see a drop of 10 to 50 points when they close one card, though some see larger drops if the card had a high limit or if they were already using a high percentage of their available credit. The exact number depends on your credit mix, payment history, and how many other accounts you have open.
The drop is not permanent. Once the account closes, the damage stops getting worse. Your score begins to recover as soon as you bring your utilization ratio down on your remaining cards — either by paying down balances or by opening new accounts (though opening new accounts creates a small temporary dip from the hard inquiry).
When closing a card does the least damage
Close a newer card before you close an old one. Your average account age matters to your score, and closing a card you opened last year does less damage than closing a card you opened ten years ago. If you have to close something, close the most recent account.
Close a card with a small credit limit before you close one with a large limit. A $500 card hurts less than a $5,000 card because you are losing less available credit. If you have multiple cards you want to close, start with the smallest limits.
Close a card when your utilization is low. If you are currently using 20 percent of your available credit and you close a card, your utilization will jump — but not as high as it would if you were already using 50 percent. The best time to close a card is when you have paid down your balances and your utilization is at its lowest.
Why you might not want to close a card at all
Leaving a card open with a zero balance costs you nothing and protects your score. You do not have to use a card to keep it open. As long as the card has no annual fee, there is no downside to leaving it alone.
An open account with a zero balance actually helps your score in two ways: it keeps your available credit high (lowering your utilization ratio) and it keeps your average account age from dropping. Many people close cards they no longer use, not realizing that the card is working for them in the background just by existing.
If the card does have an annual fee, you face a real choice: pay the fee to keep the account open and protect your score, or close it and accept a temporary score drop. For most people, the score recovery is worth closing a card with an annual fee — but if you are planning to apply for a mortgage or car loan in the next few months, it might be worth paying the fee to avoid the timing.
What happens to your balance if you close a card
If you close a card that still has a balance on it, the balance does not disappear — you still owe it. The card issuer will send you bills or statements, and you will continue making payments until the balance is paid off. Some issuers may close the account to new charges but keep it open for payments; others may close it entirely and require you to pay by mail or phone.
Closing a card with an outstanding balance also hurts your score more than closing a paid-off card, because you are losing available credit while still carrying debt. If you are thinking about closing a card, pay off the balance first.
How to close a card the right way
Call the customer service number on the back of your card or log into your online account. Tell them you want to close the account. They may ask why, and they may offer you a lower interest rate or annual fee waiver to keep you — you can accept or decline.
Ask them to confirm that the account is closed and request a written confirmation by mail or email. Do not rely on a verbal confirmation alone. Keep the confirmation for your records.
After you close the account, check your credit report a few weeks later to make sure it shows as closed by you (not closed by the issuer, which can look different to lenders). You can get a free copy of your credit report once per year from each of the three major bureaus at annualcreditreport.com.
Frequently Asked Questions
Will closing a credit card hurt my credit if I have other cards open?
Yes, but less than if you had only one card. The damage comes from losing available credit, so the more total credit you have across other cards, the smaller the percentage hit. If you have $20,000 in available credit across five cards and you close one with a $2,000 limit, you are losing 10 percent. If you had only $2,000 total available credit, you would be losing 100 percent.
How long does it take for my score to recover after closing a card?
Most people see their score recover within three to six months, assuming they keep paying other bills on time and do not run up new balances. The recovery is faster if you pay down balances on your remaining cards, which lowers your utilization ratio more quickly.
Should I close old cards or new cards first?
Close new cards first. Your average account age affects your score, and closing a card you opened last year does less damage than closing a card you opened ten years ago. If you must close multiple cards, work backward from your most recent accounts.
Can I reopen a card after I close it?
It depends on the issuer. Some will reopen a recently closed account if you call within a certain window (often 30 to 60 days). Others will not. If you think you might want the card back, ask the issuer about their policy before you close it.
Does closing a card show up on my credit report?
Yes. The account will show as "closed by consumer" on your credit report, which is different from "closed by issuer" and looks better to lenders. The closed account will stay on your report for up to ten years, continuing to help your average account age during that time.