Replacing lost credit cards won’t impact credit score

Dear Credit Care,
Hello, I need to cancel some credit cards because I have lost them. I don’t want to cancel the accounts; I just want new credit cards with new numbers on them. My question is, if I cancel my credit cards, would my credit score be affected? — Adam

Dear Adam,
I hope that you have already called your creditors and reported your lost credit cards. The Fair Credit Billing Act provides protections for liability for lost or stolen credit cards. If you report the loss or theft of your cards before any unauthorized use of your cards, you face no liability. You are also not liable for any charges if there’s an unauthorized use of your credit card number without the card itself.

Should charges be made on your accounts before you report the loss or theft, your liability for fraudulent charges is limited by federal law to $50 per card. Most card issuers go a step further than the law requires, though. Most have so-called zero-liability policies that say cardholders aren’t responsible for any fraudulent charges made on their card, period.

Still, the sooner you report the loss of your cards, the better — if only to minimize the hassles you’ll face.

Once you call your card issuers to let them know of the loss of your cards, I recommend you send them a follow-up letter. Include your account number, the date of the loss, the name of the person you communicated with when reporting the loss and the date you did so. Go ahead and spring for certified mail and a return receipt either by email or mail. That way, you have tangible proof that you reported the loss and that the letter was received.

Canceling your lost credit cards will not affect your credit score. Your card issuer will simply cancel the lost cards and issue you new cards with different numbers. The new cards will be issued on your existing accounts — not newly opened accounts — and any balances owed and terms of use for the cards will remain intact.

Keep a close eye on your credit card statements and report in writing to the card issuer any charges that you did not make. Include in your letter the date you reported the loss of your cards and the detail of the unauthorized charges you found on your statement. You will want to send the correspondence to the billing errors address for your card issuer. (If you can’t find that address, call the 800 customer service number on the back of your card and a representive should be able to point you in the right direction.) Don’t include this type of information with your payment unless requested by the card issuer to do so. You might also check your credit reports to assure that no inaccurate information is contained on them. You can do so for free at www.annualcreditreport.com.

For readers who may have a lost ATM or debit card, be aware that the federal laws for liability are different for these cards. The Electronic Funds Transfer Act provides the rules for these types of losses, and your amount of liability depends on how quickly you report the loss or theft of your card. You have no liability if you report the loss before any fraudulent charges. If reported within two business days, your liability is limited to $50. After two business days, your liability goes up to $500. For unauthorized transfers, if you fail to report them within 60 days of receiving your statement, your liability is unlimited. However, most banks’ liability policies go beyond what regulations require and limit debit card liability to $50, but these policies can vary. Be sure to call your card issuer as soon as you discover a lost or stolen card or unauthorized transfer.

Handle your credit with care!

See related:5 key federal laws that protect cardholders, All about debit, credit card zero-liability policies, 10 things you must know about credit scores and reports, A guide to the new-look credit card statements, How to get the real free credit reports