Can a cancelled credit card be reactivated

Reading time: 3 minutes

Highlights:

• Paid accounts that are inactive may be closed by the lender after a certain period of time
• You may not be notified before this happens
• The cancellation may impact your debt to credit utilization ratio and your mix of credit accounts

You may not have given much thought to the credit card in the back of your wallet or in a drawer – the one that was paid off and that you haven’t used in a while.

But after a certain period of time, which varies depending on the lender or creditor’s policies, they may consider your account “inactive” and it may be closed.

Remember that when it comes to credit, it’s important to show that you can handle financial commitments responsibly. A part of that is being able to use credit cards responsibly by paying them off regularly, on time, every time.

If you weren’t using the credit card, will the cancellation impact you at all? That depends on several factors, but here are some of the things you should know about account inactivity.  

How long can my account be inactive before it's closed?

It depends on the company. Accounts may be deemed inactive if there aren’t any new purchases on the card for a certain period of time. You may want to consider speaking with the credit card company with whom you have an account to learn more about its policies on account inactivity.

Will I be notified before my account is closed?

Not necessarily. Credit card companies aren’t required to give you any notice that they’re closing your account. The Credit Card Act of 2009 requires lenders and creditors to provide customers with 45 days’ notice of major changes to their account, but that doesn’t include card cancellation notification because of inactivity.

How does this affect my credit history?

A credit card canceled for inactivity may impact you in the following ways:

• The cancellation may affect your debt to credit utilization ratio, which is the amount of credit you're using as compared to the amount of credit available to you. Creditors and lenders prefer to see a lower ratio of how much debt you have compared with how much available credit you have.
• Lenders and creditors like to see that you are able to responsibly handle different types of credit. This includes installment loans and credit cards, to name a couple. If you have only one credit card and it is closed, it may impact the variety of your credit types, which could impact your credit scores.

In addition, if a credit card is closed due to inactivity, you may lose card benefits or accumulated rewards. If you have a credit card, be sure to understand the company’s policy about rewards and benefits if an account is closed due to inactivity.

Please note that a closed account isn’t immediately removed from your credit reports. Even if you paid the account as agreed, it can remain on your reports for up to 10 years.

What can I do?

If your card has been canceled but you want to keep it, you can contact the credit card company about the cancellation. Some lenders will reinstate the account, although you may be subject to a credit check. If you decide not to ask that the card be reinstated, it’s a good idea to check your credit report to make sure the card account shows as closed. You’re entitled to a free copy of your credit reports every 12 months from each of the three nationwide credit bureaus by visiting www.annualcreditreport.com. You can also create a myEquifax account to get six free Equifax credit reports each year. In addition, you can click “Get my free credit score” on your myEquifax dashboard to enroll in Equifax Core Credit™ for a free monthly Equifax credit report and a free monthly VantageScore® 3.0 credit score, based on Equifax data. A VantageScore is one of many types of credit scores.

How do I avoid having credit cards canceled for inactivity?

To keep a credit card active, you may want to consider using it – responsibly – every few months, if only for small purchases.  You might also consider putting a small recurring charge on the card to keep it active, or making it your primary card for a frequent purchase -- say, for gasoline purchases.

Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.

Find The Best Credit Cards For 2022

No single credit card is the best option for every family, every purchase or every budget. We've picked the best credit cards in a way designed to be the most helpful to the widest variety of readers.

Closing credit cards feels incredibly final. After all, as soon as you give the go-ahead, you’ll lose access to that line of credit and any other benefits the card includes. While closing the card is technically irreversible, that doesn’t mean you’ll never be able to get that card again. In most cases, you can re-apply for the same card in the future as a new account.

Why You May Consider Re-Applying For a Card

It might sound crazy to reopen a card that you once deemed not good enough to hold. However, circumstances change. Cards revamp included benefits, rewards structures and annual fees—making a previously subpar card a great one again. Competition is fierce right now which is good news for cardholders: Previously unfathomable earning rates and specialized statement credits sweeten the deal on many cards.

Plus, life changes even faster than cards do. Throughout the course of your life, it’s normal for your spending habits to change. Things like purchasing a home, moving cross country, taking a new job or changing your family composition can all change the types of benefits and credits that are important to you.

If you’re attracted to a card that previously didn’t work out, don’t gloss over it automatically. There’s nothing wrong with reevaluating your needs to see if it’s the right fit now.

Re-Applying Is Handled Like Opening a New Account

One important thing to keep in mind is that you’ll need to open a card from scratch, even if you were a previous cardholder. You can’t simply call up the card issuer and ask them to activate your old account. You’ll need to start a new application and go through the same approval process as anyone else.

As you re-apply, being a previous cardholder in good standing is only part of the equation. The same decision factors still apply and may include your current income, outstanding debt and credit score as well as the number of recent inquiries or open accounts you already have.

If you’re approved, you’ll have a new card number and your account age will start back at zero. While things might feel familiar, your credit report won’t reflect that.

Do Returning Cardholders Qualify for Card Benefits?

While all cardholders—whether you previously had the card or not—have access to ongoing benefits, the welcome bonus is a different story. Numerous cards entice customers in with generous one-time bonuses for opening the account but those bonuses are exactly that: one-time offers. There are some exceptions, which we’ll outline below, but if you’re reapplying for a card, you should do so for the ongoing features of the card.

It can be frustrating to not qualify for a welcome bonus, but keep your eye on the bright side. As a returning cardholder, you’ll still receive the vast majority of card benefits. On rewards cards, you’ll still earn points, miles or cash back with every purchase (including in bonus categories). Airline cards often come with perks like free checked bags and hotel cards frequently offer elite status or even free night certificates with your annual card renewal. Lifestyle perks, like monthly credits toward dining or digital streaming services, also still apply.

Welcome Bonus Policies by Issuer

American Express Welcome Bonus Policies

One of the strictest card issuers, American Express typically only offers a welcome bonus once per person per card per lifetime. Anecdotally, some customers have reported that Amex only looks back seven years to see if you were a previous cardholder, so if it feels like ancient history to you, you may be in luck.

If you can’t remember whether you had that specific card, American Express will check your bonus eligibility during the application process but before you officially submit the application. Customers who are ineligible for the bonus will see a pop-up message and have the chance to withdraw their application before their credit check is run.

Bank of America Welcome Bonus Policies

Bank of America doesn’t necessarily restrict access to welcome bonuses, but several cards require a 24-month waiting period before reapplying to the card. If a card you previously closed sounds good once again, you may need to be patient before trying again.

Barclays Welcome Bonus Policies

Requirements vary by card with Barclays, which means you’ll need to closely examine the terms and conditions before applying if you hope to earn a welcome bonus again. However, most cards clearly state “you may not be eligible for this offer if you currently have or previously had an account with us in this program.”

Capital One Welcome Bonus Policies

Like Barclays, most Capital One cards specify that previous account holders aren’t officially eligible for welcome bonuses on its cards.

Chase Welcome Bonus Policies

Chase muddles the waters a little by grouping many of its credit cards into families and considering your history within the entire segment before deciding whether or not to award you a welcome bonus.

For example, Chase has three types of personal Southwest Airlines credit cards and being a previous (or current) cardholder on one of those cards may restrict your ability to earn the bonus on a different Southwest card. Similarly, several Marriott cards are grouped together as are the Chase Sapphire Preferred® Card and Chase Sapphire Reserve®.

Thankfully, you’re not locked out from welcome bonuses forever. Many cards allow you to qualify for the bonus again as long as the original card is closed and it’s been at least 24 months since you originally received the cardmember bonus. For the Sapphire Card Collection, you’ll need to wait 48+ months.

Citi Welcome Bonus Policies

Citi also groups its cards together and considers the entire product family while determining whether you’re eligible for a welcome bonus. Typically, all co-branded cards for one travel partner (such as American Airlines Advantage cards) are considered within the same family.

Citi’s popular line-up of ThankYou cards are also considered one family. For purposes of welcome bonuses, the Citi Rewards+® Card and Citi Premier® Card and are grouped together.

Like Chase, you’re not limited to a single welcome bonus per lifetime, though you will need to wait at least 24 months after opening—or closing—any cards within that family.

Wells Fargo Welcome Bonus Policies

Similar to other card issuers, Wells Fargo doesn’t promise welcome bonus eligibility for previous cardholders unless it’s been awhile since you last earned the bonus. Terms and conditions for most of their cards specify a waiting period of at least 15 months before you’re eligible for a second bonus.

Closing and Re-Applying for Cards Versus Holding a Card Continuously

As you can see, closing a card can impact your ability to earn a welcome bonus a second time, sometimes for an entire family of similar cards and not just the individual card you held. Closing cards can also impact your credit score and other factors on your credit report, so canceling an account should always be a carefully-considered decision and not an impulse decision.

Although you may have the ability to re-apply for a card, opening and closing it repeatedly isn’t the best course of action. Think through your options before applying for a card to determine if it’s a good long-term fit for you and consider all your options before closing a card in the future. Especially for cards with low or no annual fees, you may want to keep a card open rather than closing and hoping to re-apply in the future. For pricier cards, a product change can be a good way to keep your account open while lowering your out-of-pocket costs.

Find The Best Credit Cards For 2022

No single credit card is the best option for every family, every purchase or every budget. We've picked the best credit cards in a way designed to be the most helpful to the widest variety of readers.

Bottom Line

As your personal circumstances and lifestyle changes, it’s possible that cards you previously held and canceled may become good products for you again. If that’s the case, you’re usually not out of luck. Re-applying to a credit card is essentially starting over (and sometimes without the advertised welcome bonus). Still, sometimes the right card with the right rewards, credits, benefits and other features can make it a worthwhile application.

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