What To Do If You've Overpaid Your Credit Card

Here’s one money situation when it’s OK to sit back and wait

 A smiling couple pays the bills at the kitchen table.
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Normally, it's cardholders who owe the credit card company money, not the other way around. However, an accidental overpayment could leave you with a negative balance—also called a credit balance—that your card issuer owes you.

You may feel frustrated at the situation, and rightfully so. Fortunately, there are some relatively simple steps you can follow to use the overpayment or have it refunded.

Key Takeaway

  • A credit card overpayment can happen if you pay more than the balance due or have a credit posted to your account after you've paid in full.
  • New purchases can bring your account balance back up to zero.
  • You may also request a refund by mail, online, or over the phone if your card issuer allows it.
  • Checking your balance and pending payments can prevent future credit card overpayments.

How Overpayments Happen

A number of things can lead to an overpaid credit card. You might accidentally enter the wrong payment amount. Or, you might forget your account is on autopay and send a manual payment, doubling your payments for the month.

Receiving a refund or statement credit after you've already paid off your balance can also result in a negative balance. For example, if you receive a $200 sign-up bonus as a statement credit after you've paid your account in full, you'd have a -$200 balance on your account.

What To Do If You've Overpaid

Before taking action, verify the overpayment has been cleared by your bank and has been applied to your credit card account balance. Your card issuer might have a policy of returning any overpayment that would create a credit balance. Check also for pending transactions that could wipe out the negative balance, putting you back at, or close to, a positive balance.

Spend the Negative Balance

An overpayment on your credit card will be applied as a credit to your account and may appear as a negative balance in your online account or on your billing statement. For example, if your current balance (including interest and pending charges) is $100 and you make a $150 payment, you would have a -$50 balance.

It may be easier to spend the negative balance, particularly on a credit card that you use often. New purchases will continue to reduce the negative balance, so you won't owe anything until you've exhausted the overpayment and you've started accumulating a balance that you owe. For example, if you have a -$50 balance and make a $50 credit card purchase, your account balance will be at $0. Additional purchases will begin adding to your balance due.

If you've overpaid by a large amount, it may be helpful to use your credit card to cover some of your large monthly bills or expenses.

Request a Refund

If your account has a credit over $1, you can write to your credit card issuer—typically at the address listed on your credit card statement—to request a refund. Include details on how you'd like the payment to be refunded, for example, via cash, check, or deposited into an account. Then, your card issuer will have seven days to send you a refund after receiving your request. 

Your card issuer may offer refund requests online or over the phone and may honor a request even if you're only an authorized user on the account. At a minimum, you can call your credit card issuer to ask about refund options and then follow up with a written letter outlining your request.

Wait for a Refund

Your card issuer doesn't have to wait to receive a letter from you to take action. It can optionally automatically issue you a refund right away, after receiving an email or phone request from you, or anytime within the next six months.

However,  if you still have an outstanding negative balance after six months, the card issuer is required to make a good-faith effort to refund your overpayment without any action from you.

You could lose the overpaid amount if the card issuer tries to refund you but doesn't have your latest contact information or bank account details and is unable to contact you.

How To Avoid Overpayments

While credit card overpayments are usually pretty simple to clear up, they can still affect your cash flow, leaving you in financial limbo until you get things sorted out. Avoiding overpayments can save you the hassle of dealing with the aftermath.

  • You may be able to cancel a pending overpayment if you catch it before it processes.
  • Sign up for autopay and use alerts to let you know the payment date is approaching.
  • Confirm your balance due, including pending transactions, online before making a payment.

Frequently Asked Questions (FAQs)

How long do you have to dispute a credit card charge?

You can dispute a credit card charge with your credit card issuer as soon as it posts to your account. Then, you have 60 days to dispute a credit card charge. The clock starts on the date of the billing statement with the disputed charge.

Does it hurt your credit to have a negative balance on your credit card?

A negative credit card balance won't hurt your credit score. In fact, a negative balance won’t help your score, either—negative balances aren’t factored into a credit score. However, paying down a previously high balance may give your credit score a boost.