Dear Dr. Don,
Will closing a checking account with low usage and a low balance affect my credit score? I'd like to avoid new checking account fees without lowering my credit score.
-- Confused about Checking

Dear Confused,
It shouldn't have any impact on your credit score. Banks sometimes do what's called a "hard pull" or inquiry on your credit report when you open a bank account, but there's not a reason for them to do it when you're closing the account. A hard pull on your credit report shows up as an inquiry and impacts your credit score for the following 12 months. According to the myFICO.com publication, "Understanding Your FICO Score," "For most people, one additional credit inquiry will take fewer than five points off their FICO score."

A soft pull is when a firm reviews your credit as part of a marketing decision. It only shows up on credit reports that you request, and isn't shown as a credit inquiry when others request to review your credit.

There's a separate consumer report on your banking relationships. Called a ChexSystems report, it tracks your banking relationships. Negative information, such as a bounced check, stays on your report for five years. Just like your credit reports, you can get a free copy of your ChexSystems report once per year. The ChexSystems Consumer Assistance Web page provides a link to get your free report and provides more information about that report.

If you're looking for a replacement checking account, I'd suggest reviewing your ChexSystems report before closing your existing account, just to be sure that the report is clean. The new bank is likely to review the ChexSystems report, and people with negative reports can have trouble opening a new checking account. If you have a clean report and want to open a new account, open the new account before closing the old one.