Does Closing a Savings or Checking Account Hurt your Credit Score?

Ever wonder what type of accounts do and do not impact your credit score and history?

A reader writes in with a good question on closing a checking account and I thought I’d share the answer, to provide some insight:

“G.E., I have an older checking account that I want to close. Will closing a checking account hurt my credit score or credit history in any way? Are there any other possible negatives to doing this?”

The short answer is NO (so is the long… but let me explain why…).

Credit reports and credit scores are out there as a means for lenders to determine if you are credit worthy based on your past and current borrowing and payment history.

Savings and checking accounts, on the other hand, are both assets that you own. As such, they have no impact on your credit (what you borrow). So they won’t show up on your credit reports and your credit score will not be negatively impacted by shutting them down.

closing checking account credit score

The only time your checking account may come in to play in a lending situation is if a lender asks you to prove your assets. I have had this happen when taking out a mortgage. Sometimes lenders like to see that you actually have liquid cash somewhere that you can tap, if needed, to pay them back. But closing a savings or checking an account would still have no impact on your credit score, whatsoever.

I have heard of banks flagging customers for abuse of closing and opening checking accounts to score free promotions. So that might be your only downside. Who would do such a thing? ;-)

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