Does canceling a credit card hurt your credit?

Perhaps you’re wondering: Does canceling a credit card hurt my credit? It may seem counterintuitive, but closing a credit card can hurt your credit score in the short term. You may be less likely to spend if the card is gone, but without that information on your credit report, the lender has also lost insight that could help them gauge your reliability as a borrower.

It’s important to think about the benefits and drawbacks of what closing a card would do to your overall credit health and score before you go through with a cancellation. Credit limits give you a great deal of purchasing power, and canceling a card could possibly do more damage than good. That’s especially likely, as outlined below, if it’s an older card or has a high credit limit.

There are many different credit scoring models, each a little different from the next, but they generally focus on similar factors. Closing a credit card can affect your credit score due to three main factors:

  1. Average age of your accounts


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