Your checking account charges a high monthly fee. You’re moving, and your current bank doesn’t have branches near your new home. Or perhaps you’re the victim of identity theft and want to start fresh with a new bank. Whatever the case may be, there may be times when you need to close your bank accounts.

If you aren’t sure how to close a checking account or what the process involves, continue reading for step-by-step guidance.

How to close a checking account

Whether you want to switch to a new checking account with lower fees or consolidate your finances by moving your banking to one institution, you may need to close an existing checking account.

Before doing so, know some risks are associated with closing a checking account. If you have bills on autopay that are paid through your checking account and close the account, make sure you update the payment settings with your new information. Otherwise, the payment won’t go through, and it will count as a late or missed payment on your credit report and significantly damage your credit.

If you have a negative unpaid balance — due to unpaid monthly fees or overdraft fees — banks report that information to the checking account reporting companies like ChexSystems, which can affect your ability to open a new account.

If you’re confident you’ve taken care of those possibilities, you can open a new checking account in five simple steps:

1. Review account terms and conditions

Before closing your account, review the deposit account agreement (usually, you can find it online after signing into your account). Some banks and credit unions charge early closure fees if you close an account within a specific period of time. For example, a bank may charge you $10 for closing an account within 90 days of the account’s opening date.

If you opened the checking account to qualify for a bonus offer, closing it may cause you to forfeit the cash bonus. With some banks, you must keep the account open for a specific period, such as 60 days, before you’re eligible for a bonus offer.

Close the account after those dates to avoid added fees or penalties.

2. Ensure sufficient funds

Make sure you have enough money in the account to settle any unpaid balances. For example, you may need to cover the account’s monthly fees or ATM fees. If you close the account with insufficient cash, the negative balance could be reported to the bank reporting agencies.

If you have any transactions in process, you won’t be able to close the account until those transactions are completed.

3. Notify direct deposit and automatic payment providers

Reach out to your employer’s payroll or human resources department to notify them of the account’s closure and provide your new checking account and routing numbers so they can update your direct deposit details. Otherwise, there may be delays in receiving your paycheck.

Similarly, update your bills and recurring payments with your new checking account information so you don’t miss a payment (and damage your credit).

4. Close the account

Now that you’re ready to close the account, there are three ways you can do it:

• Visit a branch: If your bank operates brick-and-mortar branches, you can visit a branch during its normal business hours. Explain to the teller that you’d like to close the account, and provide a copy of your ID. The teller will be able to complete the process on the spot.

• Online or over the phone: Some banks and credit unions allow you to close your account online or by calling their customer support departments. You’ll have to provide information about your account, and the bank representative will need to ask questions about your name and address to verify your identity before they can close the account.

• Written request: Finally, you can mail in a written request. Some banks have online forms that you can download and fill out, and they will provide instructions on where to send the closure request through the mail. You typically have to provide your full name, account number, and address as well as verify that you have settled unpaid balances.

If the account has cash in it at the time of closure, you can transfer it to a new account or opt to receive it as a check or cash to deposit later.

5. Follow up on account closure

In most cases, the bank will close your account the same day you request its closure. However, if there are transactions in process, there can be delays.

A few days after requesting the closure, it’s a good idea to follow up with the bank or credit union to ensure that the account is completely closed and that you don’t owe any money. If you find a problem, contact the bank’s customer support department in person or over the phone immediately.

Does closing a checking account affect your credit score?

Many people worry that closing a checking account will damage their credit. But bank accounts don’t affect your credit score, so closing an account typically has no effect on your credit.

However, there is an exception: If you close the account and have an unpaid negative balance, the bank will report the unpaid fees to the credit bureaus, and they could send your account to collections. If that happens, you could see a significant decrease in your credit score.

To avoid any impact to your credit, verify with the bank — ideally, in writing — that there is no negative balance at the time of the checking account’s closing.