Call the card issuer and ask for directions to close the account.
Generally speaking, you should pay off the balance and notify the issuer that you want to close the account. Cut up the card.
Check your next statement to see if it shows an amount still owing. If so, pay it off. When your statement shows a zero balance, keep it for your records.
Follow up in a month or so to make sure the account was closed. The next time you check your credit reports, make sure the account is listed as being closed at your request, not the bank’s. (Accounts closed by the creditor can impact your credit negatively.) It may take at least a few weeks, up to a couple of months, for the closure to appear on your credit report.
Be aware that closing accounts, particularly older ones, can have a negative impact on your credit score. That’s because closing an account increases your credit utilization ratio—your outstanding debt compared to the total credit available to you. For example, if you owe a total of $5,000 and you have four cards, each of which has a $5,000 credit limit, you are utilizing 25% of your available credit ($5,000 is one-quarter, or 25%, of your available $20,000). If you were to close one card with a zero balance, your utilization would jump to 33% ($5,000 is one-third, or approximately 33%, of the remaining $15,000). Having a lower ratio—less debt compared to available credit—looks better to creditors and is better for your credit score.
If you have numerous unused accounts, all things being equal, close the one(s) that are newest. A longer credit history helps your credit score.
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