What happens if you overpay on a credit card?

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what happens if you over pay on a credit card

According to CNBC, almost half of all Americans have credit card debt. While many people might be focused on getting their debts paid off, others might find it hard to imagine a time when they could ever overpay their credit card. 

But believe it or not, it happens. So, now what happens if you overpay on a credit card? Does this mean your credit card company owes your money? Let’s take a look at what overpaying on a credit card means. 

How does an overpayment happen?

While it may seem obvious, there are a few different ways someone can overpay their credit card, whether intentionally or unintentionally. Exploring how this could happen might help you make sure it does not happen again. 

Unexpected credit 

This could be a common and unexpected way to have a negative balance on your account. You make a payment for $50 and expect to pay off your credit card for the month, making you feel like you’re on top of your finances. 

Then suddenly, the shirt that you returned last week. This is a pretty easy oversight that leaves you with a $50 negative balance on your credit card. 

Auto-payment and manual payment collide 

Did you forget you signed up for autopayments and made a payment before the amount was deducted? This can cause your credit card statement to have a negative balance. 

Do not let this deter you from setting up autopayments. Auto payments are a great way to make sure you stay on top of your finances, save you money from late payment fees, and can help boost your credit score. Also, it’s super easy to set up. 

Negotiated feeds

Speaking of fees, let’s say you paid your card late last month, oversights can happen. You call your credit card company after you notice the fee on your statement and they willingly issue a refund. 

It is possible your account can be credited for a fee after you make your monthly payment, leaving you with a negative balance. Or maybe you paid off your credit card, including the fee, and the credit was applied after the fact. This can happen pretty easily. 

What happens next?

So, now that you realize that you have a negative balance on your next credit card statement, what should you do? Here are some options that might be available to you! 


You can try to request a refund from your credit card company. Depending on the credit card company your card is through, you might have the option to make the request online, but often, you’ll need to call instead. 

Federal law requires that refunds are sent within seven days of a written request. Your refund can either come in the form of a check or a direct deposit to the account that your payments are typically made from. 

Do nothing

You can leave the credit on your account, this is especially useful if it is a card that you use often. Many people use their credit cards often because of the great rewards for spending. 

Additionally, you could consider it an opportunity to pay off other cards or invest the spare funds if that is an option for you. 

Set up auto-payments

If you don’t want this to happen again, try setting up an auto-payment feature. You will likely have options in terms of how much money you would like to have automatically deducted from your account each month. 

You can either pay the minimum balance, more than the minimum, or the entire card in full. Just remember if you are planning to receive any credits that month. 

Some considerations

Keep in mind that if you overpay your credit card, the balance does not accrue interest nor does it increase your credit limit by the negative balance. 

Such an idea is a common myth. Though overpayments are not necessarily a bad thing, there is no real benefit to overpaying your credit card, so try to not make it a habit. 

It is also important to keep in mind that if the overpayment amount is substantial, your credit card company could flag the payment as fraud. Remember that substantial is a term that is relative to your account balance. 

For example, a $500 overpayment might look different if your card limit is $600 versus $5,000. Your account might be frozen to investigate the large overpayment. On rare occasions, your card might end up being canceled completely, so keep this in mind. 

Don’t worry if you overpaid 

So, you overpaid your credit card. The good news is that there is not much to be concerned about if this happens. Though you may have had other plans for those extra funds, there are benefits of both paying down your credit card and having a bit of a cushion for next month. 

Find a spending tracker app to help keep track of what you spend. Making it easy to look at your outgoing funds will help you stay on top of your payments. That way, you can save yourself the trouble of overpaying your card since you’ll be able to see your deposits and transactions, all in one place!


Does over paying my credit card increase my credit score?

Unfortunately, overpaying your credit card does not increase your credit score.

Does a negative balance increase my spending power?

Having a negative balance on our credit cards usually does not mean you can spend more. If you need a higher balance, try reaching out to your credit card company to see if you qualify for a limit increase to give you the spending power you desire.

Is it easy to request a refund of your overpayment?

It is different with each credit card company. Most allow you to call them directly to request a refund while others allow an online request or even a letter. Check with your credit card company to see which option is available for you.

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