One should be cautious in using credit card as already discussed in my previous blog. But some things are also to be considered while closing your credit cards. Few things which need to be kept in mind while cancelling the credit card are:
- The bank will not cancel your card unless you have paid all the dues. These dues include interest, fees and charges on the card along with the expenses incurred by you on card.
- Many customers feel that some card charges are unfair and proceed to cancel the card without paying these. But the bank will not cancel the card unless you pay these dues. And you would also have to continue paying interest and late payment charges on these duties till you settle everything.
- Only cutting the card at your end and mailing it to bank will not cancel the card. Always take written acknowledgment from the bank that the card has been cancelled.
If you do not cancel the card properly, there may be a case when there is an outstanding balance on your card. For example; you did not get written acknowledgment from the bank, bank may charge renewal fees which will be showed as unpaid dues, even if you have cut the card. This will continue for months and will attract penalties. This will affect your credit score and will affect your future prospects of availing a loan. Always remember to actively follow up with the lender and get your credit card closed.