It's easy to accidentally overpay your credit card. Card issuers often don't reflect a new balance after payment until it goes through, so you might pay twice by mistake. Or you might have autopay but still schedule a payment manually. Whatever the reason, overpayment results in a negative balance on your card — and you have a couple of options of how to go about it.
CNBC Select explains what you can do if you overpay your credit card, what the consequences may be and how to avoid a negative balance.
Overpaying your credit card
- What to do if you overpay your credit card
- Does overpaying your credit card affect your credit?
- How to avoid a negative credit card balance
- Bottom line
What to do if you overpay your credit card
If you find yourself with a negative credit card balance, you typically have two ways to deal with it:
- Wait it out. There's no penalty for overpaying your credit card. If the negative balance isn't significant and you use the card regularly, you can just spend the statement credit on purchases. Once you've spent it, you'll be using your regular credit line again.
- Request a refund. If you overpaid by a large amount, you might want to get the money back. The process of requesting a refund for overpayment varies by issuer, but you can typically complete it online. When the issuer receives your request, they have seven business days to send you the funds. Note that even if you don't ask for a refund, the issuer will attempt to give you one if there's any remaining negative balance on your card for more than six months.
Does overpaying your credit card affect your credit?
Fortunately, overpaying your credit card won't hurt your credit score.
You might know that carrying a balance on your credit card affects your credit utilization ratio — or how much of your credit line you're using. And if you're using more than 30%, your credit score can take a hit.
A negative balance on your card obviously won't increase your credit utilization ratio, but it won't help it either. Even if you had a negative balance of a million dollars on your card (to use an extreme example), your utilization can't get lower than 0%, so there's no benefit to carrying a negative balance.
Overpaying your card still exposes you to risk
Most of the time, a negative credit card balance won't cause any issues. However, if the amount is significant, your credit card issuer might suspect fraud. A large overpayment can be a sign of money laundering or someone attempting to get refunds for stolen items.
In this case, your credit card company could freeze your account. Fortunately, you typically can clear this up by getting in touch with the issuer.
How to avoid a negative credit card balance
Overpaying a credit card can be an inconvenience. If you want to avoid any errors in paying your card bills, there are a few strategies you can try.
Check for recent payments
Some credit card issuers make it easy to see if you've recently made a payment. If you have a card such as the Chase Sapphire Preferred® Card, tracking your payments should be simple. While Chase typically doesn't update your current balance right away, it displays the most recently schedule payment in the card details when you check the app. You can also tap "View payment activity" under the card details to see all your recent payments and whether they have gone through.
Chase Sapphire Preferred® Card
On Chase's secure site
Rewards
Enjoy benefits such as 5x on travel purchased through Chase Travel℠, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases, and $50 annual Chase Travel Hotel Credit, plus more.
Welcome bonus
Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 when you redeem through Chase Travel℠.
Annual fee
$95
Intro APR
None
Regular APR
21.49% - 28.49% variable on purchases and balance transfers
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
Foreign transaction fee
None
Credit needed
Excellent/Good
Terms apply.
Read our Chase Sapphire Preferred® Card review.
With a credit card like the Capital One Venture X Rewards Credit Card (see rates and fees), all you need to do is check the issuer's app. Capital One shows your scheduled payments on top of the recent transactions section and often updates your available credit almost immediately after you make a payment. This makes it easy to see how much credit you have available — and how much you still owe.
Capital One Venture X Rewards Credit Card
Learn More
Rewards
10 Miles per dollar on hotels and rental cars, 5 Miles per dollar on flights when booked via Capital One Travel; unlimited 2X miles on all other eligible purchases
Welcome bonus
Earn 75,000 bonus miles once you spend $4,000 on purchases within the first 3 months from account opening
Annual fee
$395
Intro APR
None
Regular APR
19.99% - 29.99% variable APR
Balance transfer fee
$0 at the Transfer APR, 4% of the amount of each transferred balance that posts to your account at a promotional APR that Capital One may offer to you
Foreign transaction fees
None
Credit needed
Excellent
See rates and fees. Terms apply.
Read our Capital One Venture X Rewards Credit Card review.
If your issuer doesn't make this information as easy to find, you can always go and check your transactions as your payment will also be displayed here.
Set up autopay
Perhaps the easiest way to avoid overpayment is to "set it and forget it" by signing up for autopay. With this feature, payments will be made automatically and you can opt to pay the entire balance each month. Just don't forget you have it in place or you risk ending up with a negative balance by scheduling an extra payment manually.
Sign up for account alerts
Autopay isn't for everyone. If you'd rather control how much you pay and when you make the payment, it's up to you to monitor your credit card balances and due dates. Luckily, your issuer can still help you with that task if you set up account alerts. You'll get credit card notifications about your balance, payments due and more, depending on what you opt into. Usually, you can set up alerts online or through the credit card app when you sign in to your account.
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Bottom line
Overpaying your card is an easy mistake to make. Fortunately, most of the time, it's only a minor inconvenience and shouldn't lead to any negative consequences. Plus, you can always request to get your money back. That said, try not to overpay too much to avoid waiting for a large sum to return to your checking account — or even having your credit card locked down due to suspicious activity.
Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit card guide is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
