Closing a bank account does not directly affect your credit score
Closing a checking or savings account by itself will not lower your credit score. Banks do not report account closures to the three credit bureaus—Equifax, Experian, and TransUnion—that calculate your score. Your credit score is built only from borrowing activity: credit cards, loans, mortgages, and payment history on those accounts. A bank account, even one you have held for years, does not appear on your credit report at all.
That said, closing an account can create problems if you are not careful about what happens to money still owed or automatic payments still running. The damage comes not from the closure itself, but from the financial mess that follows.
Key Takeaways
- Closing a bank account does not show up on your credit report and will not change your credit score.
- Problems arise only if you leave unpaid overdraft fees, outstanding checks, or automatic bill payments running on the closed account.
- Unpaid overdraft fees can be reported to ChexSystems, a banking history database that affects your ability to open new accounts, though not your credit score.
- Before closing an account, confirm all automatic payments have moved to a new account and that you have no outstanding checks or negative balance.
Why bank accounts do not appear on your credit report
Your credit report tracks only money you have borrowed and how reliably you paid it back. A checking account or savings account is money you own, not money you owe. The credit bureaus have no reason to track it, and banks have no obligation to report it to them.
This is different from a credit card, where you are borrowing money from the card issuer each time you make a purchase. It is also different from a loan, where you borrowed a lump sum upfront and are paying it back over time. Both of those show up on your credit report because they are debt. A bank account is neither.
Even if you have held the same account for decades, closing it will not affect the credit score calculation. The length of your credit history does matter for your score, but that length comes from your oldest credit account—usually a credit card or loan—not from a bank account.
What can go wrong when you close an account
The real risk is leaving loose ends. If you close an account without handling what is still attached to it, you can end up with unpaid fees or missed payments that do hurt your finances.
Overdraft fees are the most common problem. If your account goes negative before you close it, you owe that money. The bank will try to collect it. If you ignore it, the bank may sell the debt to a collection agency, and that collection account will appear on your credit report and lower your score. The closure itself does not cause this—the unpaid debt does.
Automatic payments are another trap. If you have set up automatic bill payments (utilities, insurance, loan payments, credit card payments) to come from the account you are closing, those payments will fail once the account is gone. Missed payments on credit cards or loans will be reported to the credit bureaus and will damage your score. Again, the account closure is not the problem; the missed payments are.
Outstanding checks can also cause trouble. If you have written checks that have not yet cleared, and you close the account, those checks will bounce. The payee may report you to ChexSystems, a banking history database, which can make it harder to open a new account elsewhere.
ChexSystems: the banking database that is not your credit report
ChexSystems is a separate system from the credit bureaus. Banks use it to check whether you have a history of mishandling accounts—bounced checks, unpaid overdraft fees, fraud, or other problems. If you close an account with unpaid fees or outstanding checks, the bank may report you to ChexSystems.
A ChexSystems report will not lower your credit score, but it can prevent you from opening a new checking or savings account at most banks. Some banks will not open an account for anyone with a ChexSystems record, while others will work with you if the issue is old enough or if you pay the debt first.
To avoid this, settle any overdraft fees before closing the account, and make sure all checks have cleared.
How to close an account without creating problems
Before you contact the bank to close the account, take these steps in order:
- Log into your online banking or call the bank and review all automatic payments and transfers set up on the account. Write down every one.
- Open a new account at the same bank or a different one, or confirm you have another active account ready to receive deposits.
- Change the account number for every automatic payment. Contact each company (your employer for direct deposit, your utility company, your insurance company, your credit card issuer, your loan servicer) and give them the new account number. Do this at least one week before you close the old account.
- Check your account balance. If it is negative, deposit money to bring it to zero or pay the overdraft fee.
- Write down any checks you have recently written and confirm they have cleared by checking your statement or calling the bank.
- Once all automatic payments have moved, all checks have cleared, and the balance is zero, contact the bank and ask to close the account.
Some banks will close an account over the phone. Others require you to visit a branch in person. Ask the bank which method they use, and whether they need any documents from you.
What happens to your account after it closes
Once the account is closed, the bank will stop charging you monthly maintenance fees (if there were any). Any remaining balance will be returned to you, usually by check or by transfer to another account you specify.
The closed account will remain visible on your bank statements and in your online banking history for a period of time—usually six months to a year—so you can still refer back to it if needed. After that, it may disappear from your view, though the bank keeps records for longer for regulatory reasons.
The closure itself will not appear on your credit report. Your credit score will not change because of the closure. The only way closing an account affects your credit is if the process uncovers unpaid debt or causes you to miss a payment on a credit card or loan.
Frequently Asked Questions
Will closing a bank account lower my credit score?
No. Bank accounts do not appear on your credit report, so closing one will not change your score. Problems only arise if you leave unpaid overdraft fees or if automatic bill payments fail because the account is gone.
Can a bank report me to the credit bureaus for closing an account?
No. Banks do not report account closures to credit bureaus. They may report unpaid overdraft fees to a collection agency, which would then appear on your credit report, but that is a debt issue, not a closure issue.
What is ChexSystems and how does it differ from my credit report?
ChexSystems is a banking history database that tracks bounced checks, unpaid overdraft fees, and account misuse. It is separate from your credit report and will not affect your credit score, but a negative ChexSystems record can prevent you from opening new bank accounts.
How long does it take to close a bank account?
Most banks can close an account immediately once you request it, either in person or by phone. However, it may take several business days for any remaining balance to be returned to you, and you should wait for all outstanding checks to clear before closing.
What should I do with automatic payments before closing my account?
Contact each company that has an automatic payment set up on the account and provide them with your new account number at least one week before closing. This includes your employer (for direct deposit), utility companies, insurance companies, loan servicers, and credit card issuers.