Kudos has partnered with CardRatings and Red Ventures for our coverage of credit card products. Kudos, CardRatings, and Red Ventures may receive a commission from card issuers. Kudos may receive commission from card issuers. Some of the card offers that appear on Kudos are from advertisers and may impact how and where card products appear on the site. Kudos tries to include as many card companies and offers as we are aware of, including offers from issuers that don't pay us, but we may not cover all card companies or all available card offers. You don't have to use our links, but we're grateful when you do!
Does Closing a Credit Card Affect Your Credit Score?
July 1, 2025
Quick Answers
Closing a credit card reduces your total available credit, which can increase your credit utilization ratio and subsequently lower your credit score.
If the card is one of your older accounts, its closure can shorten the average age of your credit history, which may negatively impact your score.
The closure can also affect your credit mix, the variety of credit types you manage, although this typically has a less significant impact on your overall score.
What Does It Mean to Close a Credit Card?
Closing a credit card is the formal process of terminating your account with the issuing financial institution. This action requires you to contact your card provider and explicitly request to shut down the account. Before the closure is finalized, you must pay off any remaining balance in full.
This decision is then reported to the major credit bureaus and can affect your credit score. Closing a card reduces your total available credit, which may alter your credit utilization ratio. Over time, it can also impact the average age of your credit history, as the closed account will eventually fall off your report.
How Closing a Credit Card Can Affect Your Credit Score
Closing a credit card might seem like a simple housekeeping task, but it can have surprising and significant ripple effects on your credit score. Here’s how that decision can impact you.
- Your credit utilization ratio may increase. Closing a card reduces your total available credit. If you carry balances on other cards, this instantly raises your credit utilization ratio, a key factor that can lower your score.
- The average age of your credit history could shorten. If you close one of your older accounts, it can lower the average age of your credit history, which lenders see as a sign of risk. The closed account will remain on your report for up to 10 years, but its closure can still affect the calculation.
- Your credit mix might become less diverse. Lenders prefer to see that you can responsibly manage different types of credit. If the card you close is your only revolving credit line, it could negatively impact this part of your score.
- Your score is recalculated with the new data. Ultimately, credit scoring models like FICO and VantageScore will process these changes—the higher utilization, altered credit age, and narrower mix—potentially resulting in a lower overall credit score.
How Much Will Closing a Credit Card Affect Your Credit Score?
The exact impact of closing a credit card on your score can vary, as several key factors come into play. Here are the main considerations to keep in mind before you act.
- Credit Utilization Ratio: Closing a card lowers your total available credit. This can increase your credit utilization ratio, which may negatively affect your score if your balances remain the same.
- Length of Credit History: Closing an older account can reduce the average age of your credit history. A shorter credit history is often viewed as riskier by lenders and can lower your score.
How You Can Avoid Closing a Credit Card from Affecting Your Credit Score
Pay Down Other Balances
To counteract the rise in your credit utilization ratio after closing a card, focus on paying down the balances on your other accounts. Reducing your overall debt before closing the card can help keep your utilization low and minimize any negative impact on your credit score.
Request a Credit Limit Increase
Consider asking for a credit limit increase on one of your other cards. If approved, this boosts your total available credit, which can help offset the loss of the credit line from the card you are closing, thereby keeping your credit utilization ratio stable.
Keep Your Oldest Accounts Open
The age of your credit history is a key factor in your score. Avoid closing your oldest credit card if possible, as this can shorten your credit history's length. Keeping long-standing accounts open, even with minimal use, demonstrates a stable credit history to lenders.
Ways to Improve Your Credit Score
Improving your credit score is entirely possible and achievable with consistent effort and the right financial habits. By following some proven methods, most people can see meaningful changes to their score within three to six months.
- Monitor Your Credit Reports. Regularly obtain your free reports from the three major bureaus to identify and dispute any inaccuracies or fraudulent activity that could be harming your score.
- Establish Automatic Bill Payments. Since payment history is the most significant factor in your score, setting up automatic payments is a simple way to ensure you never miss a due date.
- Reduce Your Credit Utilization Ratio. Aim to keep your credit utilization below 30% of your total available credit. You can do this by paying down balances or requesting a credit limit increase.
- Become an Authorized User. Being added to a credit card account with a long history of on-time payments and low utilization can help improve your score.
- Diversify Your Credit Mix. Lenders prefer to see that you can manage different types of credit, so having a healthy mix of revolving credit and installment loans can be beneficial.
- Limit Hard Inquiries. Avoid applying for too many new credit accounts in a short period, as each application can trigger a hard inquiry that temporarily lowers your score.
The Bottom Line
Closing a credit card can affect your credit score by increasing your credit utilization ratio and potentially reducing the average age of your accounts. The specific impact depends on your overall credit profile.
Frequently Asked Questions
Will closing a credit card with a zero balance hurt my score?
Yes, it can. Closing a card reduces your total available credit, which increases your credit utilization ratio and can lower your score, even with no balance.
How long does a closed account stay on my credit report?
A closed account in good standing can remain on your credit report for up to 10 years, continuing to positively contribute to your credit history length.
Is it better to close a new or an old credit card?
It's generally better to close a newer card. Closing an older account shortens your average credit history length, which is a significant factor in your score.
Supercharge Your Credit Cards
Experience smarter spending with Kudos and unlock more from your credit cards. Earn $20.00 when you sign up for Kudos with "GET20" and make an eligible Kudos Boost purchase.
Editorial Disclosure: Opinions expressed here are those of Kudos alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.
