If you lose a credit card or realize that it has been stolen, let your credit card company know immediately. The effect of reporting a lost credit card depends on whether and how you choose to replace the credit card. If you take the right steps, you can avoid doing any damage to your credit score.
Reporting Lost Card
The act of reporting a lost or stolen credit card to your credit card issuer does not affect your credit score at all. Report the loss right away so the issuer can deactivate the credit card and prevent anybody from using it fraudulently. Even if a thief does use your card after you lose it, you will be able to remove these charges from your account with no effect to your credit score.
Replacement Credit Card
Having a replacement credit card issued to you should not affect your credit score at all, even if the card has a new account number. This is because the company that issues the replacement card typically sets up the account with the same start date, credit limit and account history as that of your original account. Nothing will be effectively different on your credit report, so your credit score will not change.
Upgrading Card Account
If, instead of replacing your credit card with the same type of card, you choose to apply for an upgrade to a platinum account or a card with a rewards program, this might hurt your score. Before approving the application, the credit card company will have to make a credit inquiry, which hurts your score by a few points. In addition, the new upgraded credit card account might be set up as an entirely different account with the current month as the opening date. Having new credit on your report can temporarily hurt your credit score.
Closing Card Account
If you choose to entirely close the credit card account instead of having a new card issued to you, your credit score might go down. This is because closing the account reduces your amount of total available credit and therefore might increase the percentage of available credit you are using. For example, if the lost card had a $5,000 credit line and no balance and you have another card with a $5,000 credit line and $3,000 balance, you were using 30 percent of your available credit. If you close the account for the lost card, your credit utilization will suddenly jump to 60 percent of your available credit, which is likely to lower your credit score.
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