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Getting a credit card application approved is usually a good thing. But what happens when you get approved for a credit card that you quickly decide you don’t actually want or need?

Maybe you’ve read through the fine print and found that the APR is higher than you expected. Or maybe the credit limit you were approved for is not what you had hoped for.

You can cancel your new card any time, even right after you receive it, but there are some things you should know about the process.

Applying for credit

When you apply for a credit card, the credit card issuer will do a hard inquiry into your credit report. This inquiry will temporarily lower your credit score by a few points and the inquiry will show on your credit history for two years. However, the inquiry will only affect your score for a year.

There are many other factors that make up your credit score, such as credit utilization and payment history. Getting a new line of credit and using it responsibly will actually help to increase your credit score if you choose to keep your new card and use it. However, these factors will not be in play if you choose to close the card.

When the card comes in the mail

When applying for a credit card, you aren’t always clear before you apply on exactly what you will get. You may have an idea of what kind of offers the credit issuer has, but your final APR rate and credit limit won’t be revealed to you until you’re approved.

Approval may be online and instantaneous but the offer might not be detailed until you get your approval package in the mail. The approval package will consist of your shiny new card and your card agreement.

It is possible that once you read the card agreement, you won’t be happy with what you are being offered. The good news is that you don’t have to accept the card you’ve been offered — you can cancel a card at any time for any reason. However, canceling a card is not without its consequences.

Canceling the card

If you decide that you don’t want your new card, you will have to go through a similar process of canceling the account as you would with a card you’ve had for some time.

Even if the account has not been activated, you have to go through the steps to close it. You may be tempted to try to just not activate the card when you receive it, but that’s not enough.

The first step towards canceling a credit card account is calling the customer service line for your issuer and telling them you would like to close the account. During your conversation with the customer service rep, check to see if there are any fees attached to doing so and if there is a balance to clear before you close. If there are fees, make sure you ask to have them dropped and get written documentation that they have been dropped.

Send a letter documenting the date the account was closed – including the last four digits of your account, your name, date of the call and any other details – via recorded mail as evidence that the account was actually shut down. You can always request in writing to the company confirming that you have requested the account be shut down.

Finally, make sure to properly dispose of your card.

Another option

While canceling the card may feel like the best option, it may be a good idea to look at keeping the card.

This is especially true if you are just getting started with credit or are trying to rebuild your credit profile. Instead of calling to cancel the card, you could call your issuer to try to negotiate changes. See if it’s possible to lower your APR or raise your credit limit. If those things can’t be done immediately, ask your issuer what you can do to have them changed in the future. Usually, after demonstrating responsible card usage your issuer will be open to changes you request.

Also, consider that you don’t have to use a credit card frequently to maintain it. If you are trying to build your credit, making a small purchase on your card once a month and immediately paying it off will be enough to start raising your credit score.

Bottom Line

Your credit card should meet your financial needs. If you are sent a card that doesn’t meet your expectations, you don’t have to just live with it. You can try to negotiate with your issuer to get a deal that works for you. And if that doesn’t work out, you have the option to refuse the card and apply for one that will be a better fit for your needs.