(NerdWallet) – Ready to close a bank account but worried you could ding your credit score? Don’t be. By taking a few simple steps and practicing good banking habits, you can avoid having your credit affected by a bank account closure. Here’s what you need to know.

Generally, closing a bank account doesn’t affect your credit

The mere act of closing a bank account doesn’t have a direct impact on your credit. The Consumer Financial Protection Bureau confirms that the three major credit bureaus — Experian, Equifax and TransUnion — don’t typically include checking account history in their credit reports. But your credit could suffer if you’re not careful when you close an account.

Your credit score could drop if your bank account isn’t in good standing

Some blemishes in your bank account history could affect your credit. For example, if you close an account while the balance is negative or a bank closes your account because it’s overdrawn for an extended period, the negative balance could go to a third-party collection agency. That could lead to your credit report being marred.

“If the bank sends this outstanding debt to a collection agency, it could be reported to any of the three credit bureaus,” Marguerita Cheng, certified financial planner and CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland, said in an email. “Collections can trigger a drop in your credit score.”

How to close your bank account so your credit isn’t affected

You’ll need to make sure that your account is in good standing and remains that way even as you close it. Here are the steps to close your bank account properly:

1. Make a list of recurring deposits and withdrawals. Note the bills and payments paid by direct debit from your account periodically. It’s just as important to note any deposits you get, even if they’re only occasional. You don’t want your tax refund to go to a closed bank account, for example, said Miguel Gomez in an email. Gomez is a wealth advisor at Lauterbach Financial Advisors in El Paso, Texas, and host of the podcast “Dinero en Español.”

2. Open your new account and move money and automatic transactions to it. “If you have automatic payments drawn from the account you’re closing and you don’t update them before closing the account, that can affect your credit due to missed payments,” Gomez said.

3. Settle any balances on your old account. You should leave some cash in your old account to cover any pending transactions you might have overlooked, Cheng said. You can also contact your bank to ask if you have any outstanding balances. If you opened an account to take advantage of a cash bonus, make sure your account has been open for the minimum time required to avoid an early closure penalty fee.

4. Close your old account and confirm its closure. Once you’ve ensured there are no pending transactions, you can close your account. You might be able to complete the closure online, but some financial institutions require that you fill out a mail-in form, visit a branch or call to close your account.

The bank may send you an email to confirm the account closure, or you can contact a representative by phone or in person to confirm the account has been closed and request confirmation in writing. Note that if your account earned interest or a cash bonus over the year, you’ll need to get the proper paperwork from the bank for your taxes. Follow these steps when you close your bank account and you’ll avoid fees, missed bills and credit woes.