How to Cancel Chase Credit Card and Its Impact on Credit Score
If you’ve brought your chase credit card balance to $0 and you no longer need your card, it should be easy. So you might be looking to cancel your Chase credit card! The good news is that you can easily cancel unwanted credit cards as long as you go about it the right way.
There could be many reasons a person decides to cancel their credit card. The process of canceling a credit card typically differs from one company to the next.
Consumers who have Chase credit cards have the option of canceling their card over the phone, through the mail, or via the secure messages feature on the Chase website.
The Pros and Cons of Canceling a Credit Card
Given the many potential positives and negatives, you might be having an internal conversation with yourself about whether you should cancel an unwanted or unneeded credit card at all.
On the plus side, you would have one less financial vehicle to worry about. With the vast increase in identity theft crimes today, this also means one less piece of financial information for a criminal to get hold of — especially if its a card you aren’t using or monitoring regularly.
If the credit card company is charging you an annual fee, you could also save a bit of money by canceling a card you don’t use.
On the flip side, many people keep an extra credit card in place to use for emergencies, such as unexpected car or home repairs. A credit card can provide a method of paying these costs quickly without having to dip into your savings.
In addition, many credit cards today offer points or other types of rewards. These can be used for travel and hotel stays, along with a whole host of other items.
So canceling a credit card may mean that you would forgo these perks.
Why Should You Cancel a Credit Card?
So, when does it make sense to cancel a credit card? One reason to part ways is if you aren’t using it. In that case, there is no need to hang on to the card, even for emergency purposes.
If you’re prone to impulse purchases, having an extra credit card on hand could become very tempting (especially if it carries an ample line of credit). In this situation, canceling the card could end up saving you a great deal of money.
It could also be that your credit card (or cards) are costing you money to keep, like those that charge an annual fee. If you’re benefiting from rewards — such as travel or points — it might still be worth it to hang on to the card(s).
But if you’re no longer using the rewards, it could make more sense to cancel it and save yourself the fee.
Read: Chase Preapproved Credit Card – How to Qualify 2020
How to Cancel Chase Credit Card
Cancel a Chase Credit Card Over the Phone
Canceling by phone is quick and easy. Cardholders begin the process by calling 1-800-432-3117 (found by google searching “Chase credit card customer service number”).
The system prompts cardholders to enter their 16-digit credit card numbers. Then they are presented with various automated options. Skip the automated options and speak to a customer service representative instead.
Cancel with the representative, and get his or her name and number. Write it down in case the card cancellation does not go through.
Cancel a Chase Credit Card via a Written Request
Those who want to cancel via the mail need to write a short letter that includes their full name and address. The letter should also include the credit card number and a short cancellation request.
Ask Chase to notify the credit bureaus that the account was closed by the account holder.
Take the letter to the post office and send it certified. Keep a copy of the letter and tracking the information on hand.
Cancel a Chase Credit Card on the Chase Website
Chase doesn’t advertise that people can cancel online via the website, but it is possible. Cardholders begin by logging into their accounts. Then navigate to the “Secure Messages” feature.
Write a brief message requesting the cancellation. Send the message, and then wait for a reply. Responses are sent out within 24 hours. The response will likely confirm that the account has been closed.
If not, it will include further instructions for the cardholder to follow.
Considerations Before Moving Forward With a Credit Card Cancellation
Canceling a credit card can be a big decision, especially if you’ve had the card for many years. With that in mind, there are some important factors to consider before you move forward with a credit card cancellation. These include:
- Knowing how you will pay off or transfer the card’s balance
- Determining how (or if) canceling the card will impact your debt to credit ratio
- Having another plan in place for potential emergency expenses
- Considering whether the cancellation will reduce your credit score
Following Up After Canceling an Account
Wait 60 days after canceling your Chase credit card account. Then cardholders should pull their credit reports from the three major credit bureaus. Check the report to make sure the card has been canceled.
If it has been canceled, there’s a need to do anything else. If it still shows up as active on the credit reports then Chase should be contacted once again. By this time, you should contact the company by phone and speak to a representative.
Also Read: How to Dispute a Credit Card Charge: After You willingly Paid For it.
Impact on Credit Score
Closing a credit card is easy to do, but it should be given some thought before moving forward. It’s important to understand the impact of canceling a credit card before going through the process.
There can be short and long-term effects on a consumer’s credit score.
First, cardholders must consider their credit utilization ratio which is the ratio of your credit balance to your credit limit. When cardholders close credit card accounts, their available credit will drop, so theoretically, their utilization ratio should increase.
This could potentially drop a credit score under certain scenarios. Ideally, a credit utilization ratio should be around 30 to 40 percent at maximum.
Second, closing a credit card also impacts the length of credit history. Closed accounts eventually fall off credit reports and are no longer factored in when determining the length of your credit history.
Length of history is incorporated into a credit score, so theoretically, it should change if you close an account.
Third, the mixture of credit should also be considered. Credit scores are impacted by the mix of credit. A bit of diversity is taken as a positive signal. Cardholders who have other credit cards don’t need to worry about this.
However, if it is their only credit card, it could negatively impact your score if you take out that component of credit.
There are definitely both positives and negatives to canceling a credit card. Before you do, make sure that you are getting rid of the card for the right reasons, and that it won’t come back to haunt you.
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