What Happens If You Overpay Your Credit Card?

One of the best financial tools you can have is none other than a credit card, provided that you use it properly. Credit cards allow you to make big transactions with no need to carry any cash with you. They also come with excellent rewards programs that help you save money on your daily expenses.

But, even with all the benefits they offer, a credit card is not free money at all. You will receive a bill every month for your credit card balance. It is ideal that you fully pay your bill although many people end up paying less than the complete amount at one point of their lives.

However, there are times when the exact opposite happens. You might end up paying more than the total amount due that can result to a negative credit card account balance.

So, what will happen when you overpay your credit card?

If an overpayment is made, your credit card balance will become negative. It means that your card issuer is the one who will owe you money instead of the other way around.

Avoid Overpaying Your Credit Card If Possible

While it is not the worst thing that can happen, an overpayment on your credit card is still not a great thing at all.

For instance, you wouldn’t want your credit card issuer to hold your money. Each dollar that sits in the account of the credit card company instead of your account will make the company earn the interest instead of you. Aside from that, your money will also be tied up and won’t be accessible to you. In the event that you need cash for paying your bills and you got lots of money tied up in your overpaid balances in your credit card, you might face a financial problem even if you could have paid off the bills.

How to Deal with Overpaid Credit Cards

There are several options that you can try to remedy the situation if you accidentally overpaid your credit card bill:

      1. Spend it.

You are basically paying for any future expenses in advance if you overpaid your credit card. The easiest and simplest thing you can do in this case is to just continue with your regular use of your credit card. The future purchases you make are going to be applied to your accumulated negative balance. Once you have reached the point that you owe money all over again, simply continue to make payments like the usual.

     2. Request for a check.

Technically, the money is still yours even if you sent it to the credit card company. While it is not common to overpay a card, is it also not as uncommon as what you think. Many card issuers will be more than happy to give you a refund for your overpaid amount in the form of a check. You can simply reach out to the company by email or phone to ask for a check for your overpaid balance.

     3. Don’t do anything.

Even though this is not just the slowest but also the least recommended step, you can always do nothing with that negative balance on your credit card. Credit card companies should legally make an effort in good faith to give you a refund of your negative balance after a period of 6 months of the card being unused.

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