Negative Balance On a Credit Card: What Does It Mean? | Chase (2024)

FAQs

Negative Balance On a Credit Card: What Does It Mean? | Chase? ›

A negative credit card balance is when your balance is below zero. It appears as a negative account balance. This means that your credit card company owes you money instead of the other way around. Typically, this happens when you've overpaid your outstanding balance or if you've had a credit returned to your account.

Will a negative credit card balance affect your credit score? No, a negative balance does not affect a credit score. Most credit models consider negative balances equivalent to a $0 balance, which means negative balances don't hurt credit scores.

It means that you have a surplus amount on your card. You can check for the exact reason of the surplus with your card provider and use the negative balance for purchases. Why does my credit card show negative balance? It means that you either overpaid against your card or you have received some cash back or rewards.

Generally, your overpayment will appear as a credit in the form of a negative balance on your account. This negative balance will roll over towards any new charges you make or outstanding balances for the next month.

A negative balance occurs when you make payments that exceed the funds in your account. Overdraft protection can help cover the difference, but it comes with fees. A negative bank balance can lead to overdraft fees, non-sufficient funds fees, account closure, and credit impact.

Request a deposit: Check with your credit card issuer to see if you can request the negative balance amount to be deposited to your bank account. You can also ask for a check, money order or cash. Make a purchase: This is the easiest way to resolve a negative balance.

A credit card balance is the amount of credit you've used on your card, which includes charges made, balances transferred and cash advances (like ATM withdrawals). You can think of it as the amount of money owed back to the credit card issuer. If you don't owe a balance, it will appear as zero.

Having a negative balance on a credit card isn't a bad thing, but it has some points to consider: Negative balances don't affect credit. Most credit models typically consider negative balances equivalent to a $0 balance. This means a negative balance won't hurt a credit score.

A deficit, then, is a negative balance (or an excess of debits over credits) on account of certain transactions (the items above the line), which will cause trouble if it becomes large and persistent; to prevent this, some adjustment of the balance of payments is called for—and usually some adjustment in the domestic ...

A negative balance indicates that your bill was overpaid and that you may be eligible for a refund.

What happens if I put more money than I owe on my credit card? ›

In most cases, an overpayment on your credit card isn't likely to cause any problems. However, if it results in a significant negative balance, you could trigger a fraud alert. A large negative balance can sometimes be a sign that someone is laundering money.

If your balance remains above your limit in the next billing cycle, you could be charged the over-the-limit fee again. And if you can't pay the minimum payment, you could be hit with late fees. You may also face increased interest rates with a penalty APR if you go over your limit.

You won't be penalized for overpaying your credit card, but there are also no benefits for doing so. When you pay more than the balance due, your issuer should automatically issue the amount you're owed as a statement credit and your credit line will reflect a negative balance until you've spent the credit.

Negative account balances can occur for several reasons, but regardless of the cause, a balance below zero isn't a bad thing. In fact, it means you have a credit on your account, so future purchases up to that amount won't cost you additional money.

A negative number means you do not owe money. (Example: -$100.00) means you DO NOT owe money and you will get a refund.

In most cases, the bank won't close your account as long as you deposit sufficient money to make the account positive within 30–60 days (depends on the bank). The big problem that you're going to have is that multiple overdrafts will result in you paying lots of money in overdraft fees.

Overdrafts don't usually affect your credit scores unless you don't resolve them quickly and the account goes into collections. Checking accounts aren't included in your credit reports from the three major credit bureaus, but they could be included in your ChexSystems report.

For example, let's say you have a credit card with a $1,000 credit limit and a negative balance of $50. The result is a temporary credit limit of $1,050. However, your credit limit will drop back to $1,000 once you clear the negative balance by making a purchase or receiving a credit balance refund.

If you have paid your card down to a zero balance before receiving your refund, you will have a negative balance on your credit account — and any future purchases will be applied to the negative balance first.

If you have a negative bank account, that means you've taken out more money than was available in the account. Letting an account go negative can be costly, because banks charge fees when this happens. And your bank could close your account if it stays negative for too long.