(WHAS11) -- Breaking up is hard to do, closing out a credit card can put a big dent in your credit score if you're not careful about it.
You've probably heard that closing a credit card can actually damage your credit score. But do you know why?
It's your credit utilization ratio, the amount of credit you've used compared to the amount you have available. It's a factor that's about 30 percent of your score.
If you're considering closing an account credit card expert Beverly Harzog says don't do it if it's your only card and if you have others, check the balances.
“Take a look at your other balances on your other credit cards. Are they fairly low? You want to get the balances as low as possible so that you have a low utilization ratio even if you close that credit card and lose that available credit,” said credit card expert Beverly Harzog.
Common reasons consumers close cards are new or increased fees or interest rates. If you're switching to a new card, keep the old one open until you receive it.
"That way your FICO score will start utilizing the new available credit with the new credit card into your FICO score, so you'll minimize the impact a little,” explains Harzog.
It's best to have a zero balance when closing the card. You can close it over the phone, but also follow up later in writing.
After a month or so, check your credit report to make sure the account is noted as "closed."
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