Your bank stops processing transactions on that account, and any money in it goes to you
When you close a checking account, the bank freezes it immediately or within a few business days. No more deposits go in, no checks clear, and no debit card charges process. Any balance you have gets sent to you by check, electronic transfer, or sometimes held in a savings account at the same bank. The account itself stays on your credit report for a period of time, but closing it does not hurt your credit score.
The main risk is that checks you wrote before closing might bounce if they arrive after the account is closed. Automatic payments and direct deposits also fail if they hit the account after closure. That is why the timing of when you close matters more than the closing itself.
Key Takeaways
- Checks you wrote before closing the account will bounce if they arrive after the bank closes it, so contact anyone you owe money to first.
- Direct deposits and automatic bill payments stop working once the account closes, so redirect them to a new account or cancel them before you close.
- Your remaining balance is returned to you by check, wire, or transfer within one to two weeks, depending on the bank.
- Closing a checking account does not lower your credit score, but the account may appear on your credit report for up to seven years.
- If you owe the bank money or have unpaid overdraft fees, they will deduct that from your balance before sending the rest to you.
What happens to checks you already wrote
Any check you wrote before closing the account will bounce if it arrives at the bank after the account is closed. The person or business that deposited it will see a "account closed" or "insufficient funds" message, and they may charge you a returned check fee on top of the bank's fee to you.
Before you close, contact anyone you regularly pay by check — your landlord, utilities, insurance company, anyone else. Tell them the account is closing and ask when they last deposited a check from you. If you are unsure, wait an extra week or two after your last check before closing, or switch to a new account and keep the old one open for another month while checks clear.
If a check does bounce after you close, you are still responsible for paying the person or business. The bank will not reopen the account to process it. You will need to pay them directly or by another method.
Direct deposits and automatic payments stop working
Any paycheck, government payment, or other deposit set to go into the closed account will be rejected. Your employer or the government agency will get a message that the account no longer exists. Some will try again; others will stop and wait for you to provide a new account number.
Automatic bill payments — for utilities, credit cards, loans, subscriptions — also fail. The biller gets a rejection notice and may charge you a late fee if the payment does not go through. Some billers will try again automatically; others will mark your account as delinquent.
Before closing, log into your bank's website and review all automatic payments and deposits. Change the account number on each one to your new bank account, or cancel the automatic payment and set it up again after the account closes. This takes 10 to 15 minutes but prevents weeks of missed payments and collection calls.
How your remaining balance gets back to you
The bank sends your balance to you in one of three ways: by check mailed to your address on file, by electronic transfer to another account you specify, or sometimes by holding it in a linked savings account. Ask your bank which methods they offer when you close.
Electronic transfer is fastest — usually one to three business days. A mailed check takes five to ten business days depending on postal service. Some banks hold the balance for a few days before sending it, so the total time from closing to receiving your money is usually one to two weeks.
If you have a negative balance — meaning you owe the bank money from overdraft fees or other charges — the bank deducts that from your balance before sending the rest to you. If the negative balance is larger than your deposit, the bank may send you a bill or refer the debt to a collection agency.
Overdraft fees and other charges the bank may keep
If your account has unpaid overdraft fees, insufficient funds fees, or other charges, the bank subtracts them from your closing balance. For example, if you have $500 in the account and $75 in unpaid fees, you receive $425.
Some banks waive one or two overdraft fees as a courtesy if you ask when you close the account. It never hurts to ask, especially if you have been a customer for years or if the fees were from a single mistake. Banks have discretion to forgive fees, and they sometimes do.
If the fees exceed your balance, you owe the difference. The bank will contact you about payment, and if you do not pay, they may report it to ChexSystems, a banking history database that other banks check before opening new accounts for you.
How closing affects your credit and banking history
Closing a checking account does not lower your credit score. Checking accounts are not reported to credit bureaus the way credit cards and loans are. Your score is based on credit history — how you borrow and repay — not on which bank accounts you have.
The closed account does appear on your ChexSystems report, which banks use to decide whether to open new accounts for you. It stays there for five years. If you closed the account in good standing — no overdrafts, no unpaid fees — it has no effect on your ability to open a new account elsewhere. If you closed it with a negative balance or unpaid fees, some banks may decline to open an account for you.
If you want to open a new checking account soon after closing one, choose a bank that does not use ChexSystems or that is lenient with ChexSystems records. Credit unions and some online banks are more flexible than large national banks.
When the bank might not let you close
Most banks let you close an account anytime, but a few situations can delay or prevent it. If you have a negative balance — you owe the bank money — some banks will not close until you pay. If you are in a dispute with the bank over a transaction, they may freeze the account while they investigate.
If the account is linked to a loan or credit product at the same bank, closing the checking account might affect that loan. For example, if your mortgage payment comes from that checking account, the bank may require you to set up a new automatic payment before closing.
Call your bank and ask directly: "Are there any reasons I cannot close this account?" They will tell you if there are holds, disputes, or linked products that need attention first.
Frequently Asked Questions
Can I reopen a checking account I closed?
Most banks will let you reopen a closed account within 30 to 90 days if you closed it in good standing. After that window, you have to open a new account. If you closed with unpaid fees or a negative balance, the bank may refuse to reopen it or open a new one for you.
What if a check arrives after I close the account?
The check bounces, and the person or business that deposited it gets a returned check notice. You are still responsible for paying them the amount of the check. Contact them directly and pay by another method, or ask if they can redeposit it to your new account if you provide the number.
Do I need to close the account in person or by phone?
Most banks let you close by phone or online. Some require you to visit a branch in person, especially if you have a large balance or if there are complications. Call your bank and ask what they need from you.
How long does it take to close a checking account?
The closing itself is instant or takes a few business days, depending on the bank. Getting your money back takes one to two weeks. The account may stay on your ChexSystems report for five years.
Will closing a checking account hurt my credit?
No. Checking accounts do not affect credit scores. The closed account shows up on ChexSystems, which banks use to decide whether to open new accounts for you, but it does not lower your credit score or appear on your credit report.