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Overpaying a credit card

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Overpaying a credit card

I overpaid my credit card so that a very expensive purchase would be covered.  It was an unusual splurge, so the credit card company put a temporary hold on my card pending an explanation.  I thought the hold was taken care of until I attempted to use my card. The next issue was overpaying my credit card.  I was informed that I could lose my credit card by overpaying it.  This is new to me. Has this always been policy for credit cards or is this something new?  Thank you1
Message 1 of 5
4 REPLIES
Established Contributor

Re: Overpaying a credit card

You can lose your credit card for any reason, real or imagined or for no reason at all. That's because it isn't "your" card, it's their card.

 

Some CCC's don't like you overpaying by very much and they don't like you gaming their imposed credit limit by overpaying to make a larger purchase. Some couldn't care less.

/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\/\

"No good deed goes unpunished"




There is nothing more simple, nothing more complex than the relationship between Country Boy and Dog.
Message 2 of 5
Senior Contributor

Re: Overpaying a credit card

Most CCC's will not approve a purchase larger than your CL, even if you have a credit balance.  Your CL is not in relationship to your balance, except as "available credit" which is not associated with a credit balance.

 

If you have a $500 credit and a $1000 CL, usually you can only charge up to $1000.  The credit would then post against your charges and you would then have a $500 charge balance.  But the credit will not add to CL or give you the ability to get an approval on a purchase greater than $1000.

 

And if you significantly overpay your balance, this can flag your account with "unusual" activity, which ccc's don't like unusual.

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09/03/2009 TU: 777, EQ: 776 ($8 balance on an account dropped me out of 780's)
03/28/2009 TU: 814, EQ: 810, EX: 781 (02/12/2009)
05/18/2005 TU: 563, EQ: 580, EX: 549
Message 3 of 5
Established Contributor

Re: Overpaying a credit card


txjohn wrote:

If you have a $500 credit and a $1000 CL, usually you can only charge up to $1000.  The credit would then post against your charges and you would then have a $500 charge balance.  But the credit will not add to CL or give you the ability to get an approval on a purchase greater than $1000.


I agree. I tried doing that with my BoA Visa last year which had a $700 CL and paid $700 thinking that I could buy the iMac I wanted for about $1,400 but BoA declined the charge since it was more than $700.

 

Message 4 of 5
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Established Contributor

Re: Overpaying a credit card

Truth be told, CCCs never like a credit balance. They want you to owe them, not the reverse. However I can't imagine them actually closing on you unless, like everyone else is saying, you try using the credit balance to buy more than your CL will allow.

 

Making them owe you some money will annoy them, but trying to game the system and increase your CL could definitely bring down some AA.

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