Everyday Cheapskate: How to Break Up With Your Credit Card Account

Closing a credit card account is not for the faint of heart. So, why bother? Oh, let me count the ways:

No. 1: Excessive lines of credit—even those with a $0 balance—can wreak havoc on your credit rating.

No. 2: Many open lines of credit are difficult to manage.

No. 3: Lets not forget that temptation factor.

Truth be told, all you really need is one—two at the most—good, all-purpose credit cards.

Now, before we get into how to close accounts, lets look at the facts. Banks, credit card companies, and retail credit granters are very keen on retaining their revolving “open-end” credit accounts (from the Latin root meaning theres no end to the amount of money we intend to squeeze from you during your lifetime).

These companies paid dearly to bait, snag, and reel you in. Youre an asset on the balance sheet. And since the time you first met, its likely youve rewarded them handsomely.

When they learn youre breaking up, they will not be happy. In fact, they may ignore your every attempt to do so. Note: It is not advisable to close an account until you have achieved a $0 balance. To do otherwise invites an interest increase to the maximum allowed by law and possibly a demand for the entire balance to be paid immediately.

Make the Call

Find the toll-free number for customer service (find it on the back of the credit card, on the last statement, or possibly on your credit report). Tell the rep to close your account. Youll get an argument, of course, but stick to your guns. Say, “Close my account, and report it closed to the credit bureaus.” Make a note of the full name of the person you spoke with and the date you made this request.

Send the Letter

Immediately follow up with a letter referring to your conversation and restating your instruction. Enclose the credit card, which youve cut into pieces, if you still have it. Send this letter by certified mail with delivery confirmation. This will cost you a couple of bucks in addition to the regular postage. Once you get that signed receipt back, attach it to your copy of the letter.

Follow Up

In about two weeks, call customer service again to confirm your account is closed. Assume it wont be (theyre fighting you here, so expect them to deny ever hearing from you at all). Repeat your verbal instructions: Close this account!

Verify

In about three months, order a copy of your credit report (from AnnualCreditReport.com). If the account shows “closed at request of customer” or something similar, youve achieved success.

Repeat as Necessary

Until the account is reported as closed, go back to step one and go through all the steps again. You could get full cooperation on your first call, or it could take several rounds to permanently part company with this account.

Lesson to Be Learned

Its a lot easier to get a credit card than to get rid of one. Simply cutting it up is not good enough. Even if you have all the current information such as your account number, the customer service phone number, and the address, it could cost you iRead More – Source