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Does closing a bank account hurt your credit?

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A common question when closing a bank account is whether it will have a negative impact on credit scores. The good news is that closing a savings or checking account that is in good standing does not affect your credit in any way.

are several factors to keep in mind when closing your bank account to ensure that it is done properly and does not lead to any credit issues.

How credit bureaus fit in

The 3 major credit bureaus

Equifax, Experian, and TransUnion are credit bureaus that keep records of how people handle borrowing money. This means a person’s credit report may contain information about their payment history and outstanding debts on things like mortgages, personal loans, and credit cards.

A bank account that is in good standing will not impact your credit because bank account information is not usually part of a credit report.

If you have a bank account with a negative balance and decide to close it without first paying any overdraft fees or settling the negative balance, your debt may be sent to a collection agency. This could result in a lower credit score, as the agency may notify the three credit bureaus, and the negative information could stay on your credit report for up to seven years.


ChexSystems is a type of reporting agency that collects information from financial institutions under the Fair Credit Reporting Act. They receive information on things like and negative balances from the banks. This means that if you close a bank account that has negative activity, it can appear on your ChexSystems report.

Banks can access ChexSystems reports to determine if they should approve an application for a bank account, and information remains on the report for five years. However, closing a bank account in good standing will not have a negative impact on a person’s ChexSystems score.

How to close a bank account without hurting your credit

If you have an outstanding negative balance on a closed bank account, it may lead to being reported to a collection agency and credit bureaus. If you’re thinking of closing your current bank account and opening a new one at a different bank, make sure to take the necessary steps to avoid negatively impacting your credit.

1. Open your new bank account before closing the old one. To avoid any damage to your credit score due to the temporary lack of bill payment methods, it is recommended that you continue using your old account for activities like online bill payment, check writing, and sending money via services like Zelle. This is because funding the new account or ordering checks may take some time.

2. Fund the new account and reroute direct deposit there. To start using the new account, you can deposit cash at a branch or transfer funds electronically from the old account. If your paycheck is currently being directly deposited into your old account, you should inform your employer and ask them to reroute the direct deposit to your new account.

3. Update automated bill payments. If you have enough money in your new account, make sure to change the accounts used for any automatic bill payments. This can include payments for things like rent, student loans, utilities, insurance, gym memberships, and other subscriptions. Be sure to check your old account’s transaction history to ensure you don’t forget about any automatic payments. If you forget, your old account could have a negative balance.

4. Close the old account. It is advisable to wait for around a month after opening a new bank account before closing the old one. This will help you ensure that your direct deposit has been redirected correctly and all automatic bill payments have been transferred successfully.

Bottom line

If you want to close your existing bank account, which is in good standing, then it won’t have any negative impact on your credit score. However, if your account has a negative balance, it’s critical to settle the dues before closing it. Not doing so may have an adverse effect on your credit score.

To avoid missed payments and potential credit problems, it is advisable to confirm that direct deposit and automatic bill payments are working properly in your new bank account before closing your old account.

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