A few days ago I arrived at my house. On the floor was a sealed envelope addressed to me; It was from a bank.
A few days ago I arrived at my house. On the floor was a sealed envelope addressed to me; It was from a bank. I opened it and said that I had a pre-approved credit card, I just had to call a telephone number that they indicated there and request that it be sent to the branch of my preference.
Another day I went to an expo on business at the World Trade Center in Mexico City, a couple of people approached me to tell me that with a picture of my ID and a couple of signatures they could give me a credit card.
That’s right, the stability in the economic situation in our country, coupled with unethical practices by bank executives, has caused an accelerated expansion of consumer loans. Nowadays it is easier to get a credit card than a loan to open a company. Worse, you can have ten cards without checking income or prove that you are responsible and know how to use them.
But that is not exactly the topic I want to address today. I want to talk with people who have 4, 5 or maybe more cards and they are already making a mess between court dates, payment deadlines or if they bought things for months without interest and do not remember. What do they owe on one card and what do they owe on the other? If that is your case, stay to read this text, it will help you. If it is not, also read on, and do not fall into the network of 25 credit cards.
Get rid of your credit cards
Paraphrasing Uncle Ben – All power carries a great responsibility – in that context we must understand that credit cards are not bad at all, they are a good financial instrument and, if we use it as a tool, it will help us a lot in our lives. But if you have already fallen into the “claws of the banks” and you have many credit cards, I advise you to cancel the majority and keep those that really give you a benefit.
How to know what cards to keep and how many? It will depend a lot on your lifestyle. Suppose you like concerts a lot, there are cards that have agreements with a show company that offers you exclusive presales, that gives you a real benefit to you. If you do not go to concerts, but you travel a lot, keep that card that gives you benefits for your trips, in short, it is something you will have to ask yourself and analyze. In addition to these factors you should think of other objectives such as interest, annuity, etc. To delve deeper into that topic, please consult this article by Victoria Pinto on the Bancompara blog.
Personally, I recommend you keep only two credit cards. One bank and one departmental. The department will help you take advantage of exclusive promotions from the store for which you already have preference. On the other hand, a bank card with a large credit line is sufficient. How much is a broad line of credit? For reference only, that is equal to or greater than three months of your current salary.
First steps to cancel my credit card
Canceling a credit card is a simple process if you have not used it or have no debts on it. Otherwise, you will have to use a strategy. Once you have decided which card or cards to keep, contact the bank where you want to continue and ask if there is a possibility that they will cancel the debts with other banks and that they absorb that debt.
I give you an example. Suppose you owe $ 10 dollars to bank “A”, $ 12 dollars to bank “B” and $ 6 dollars to bank “C”. You decided to keep the Bank Card “A”. You contact the bank “A” ask that you transfer the balance of the cards of banks “B” and “C”. Now your balance on the bank card “A” will be $ 28 dollars.
You must be careful, sometimes banks make promotions that allow you to make this move at no cost. But most of the time they charge a commission. You will have to evaluate whether you should pay that commission or not.
Alternative of consolidating your debts through a personal loan
Normally these loans have a lower interest rate than a credit card. Be sure to take this alternative before defaulting payments, otherwise this will not be an option.
In case you do not have the possibility or do not want to transfer the balance of your cards to one, the first thing you will have to do to cancel credit cards that you no longer want is to stop using them. If you have services domiciled or with automatic charge on the cards that you no longer want, ask those services to now make the charges to the card you decided to keep.
If you are already sure that there will be no more automatic charges of any kind on the card you want to cancel, hide it, if possible, or at least keep it well to avoid the temptation to use it. This point is essential, because you will not be able to cancel that card until the balance is zero.
The crucis route of cancellation
Whatever alternative you choose, that beautiful day will come when you pay the total balance of the card and you can get it out of your life. First, make sure you have paid the total, with everything and cents, or you will not be able to cancel it. Do not overdo the payment, or for pennies, because you will have a balance in favor and will not allow you to cancel it.
You must wait 48 hours after making the payment to cancel the card. If you decide to cancel your card by going to a branch, you must submit a letter (it can be by hand), requesting the cancellation of the plastic. In the writing you will have to put your data and a proof of payment that reflects your balance in zeros. And, of course, you will also have to carry the plastic, which must be destroyed in your presence. Remember that they cannot charge you any type of cancellation fee.
Another option that may be more comfortable for you is to cancel it through a phone call. When doing so by this means just have your credit card and a lot of patience at hand, because in the bank’s customer service menu you will never find the cancellation option. I suggest you choose any option that allows you to talk to a person as soon as you can and that person asks you to contact the cancellation area. Write the cancellation sheet, as well as the full name of the person who attended you. These data will help you in case of a later clarification.
Surely you will find reluctance to cancel the credit card by the banks. These barriers can be “dirty”, like telling you that in the branch you cannot cancel, communicate from one person to another and even cut off the communication. Other barriers may be more benevolent, of the type promising to forgive the annuity or lower the interest rate if you keep the card. Do not despair, stand firm at the branch or continue calling, and do not fall for their offers. Think that if you are really interested as a customer they could have given you a better deal before.
If you managed to get around all the difficulties and not succumb before the tricks of the banks, then you already have one less card. Is that the end of the process? It may be, but it is recommended that you make sure that the card is actually canceled.
You have two options, the first is to wait 48 hours after the credit card has been canceled and call the bank again to confirm that the cancellation request has proceeded. The second option is to wait ten business days after having processed the cancellation to request a letter or proof of no debit. This document will be very useful in case you want to apply for other more relevant credits in your life, such as a mortgage loan.
You may not want to do this last process, because you will be tired of talking to different people at the bank and trying to convince them to let you go. Then you have one last option to make sure your card has been canceled.
All banks are required to report cancellations to Credit Information Companies
These companies update the information every month. If you wait for a prudent time, you can check your information either in the Credit Bureau or in the Credit Revolution, there you must verify that the credit cards you canceled have the status of “closed”, as well as a legend that says “current account ”Or“ account without information ”, as well as the current balance at zero.
You can obtain the credit bureau report, through its page, for free once every twelve months. If you want to get more than one report within that period, it will have a cost.