What happens if I overpay my credit card?

You likely know the consequences of not paying your full balance. At best, you may owe some interest; at worst, paying less than the minimum may lead to fees and negatively affect your credit score.

In short, not much happens when you overpay. It may not be good or bad, but you just reduced your checking or savings balance by paying your credit card company more money than you needed to. The main indicator on your credit card will be a negative balance. A very important part of your credit card statement is the statement balance, and that's calculated at a specific time every month. Usually, an overpayment is all about timing, and there are different ways overpayments can happen.

Different ways to overpay a credit card

Here are some ways you might overpay your credit card:

• Making a mistake when typing: If you accidentally enter the wrong amount, you might pay more than you intend or a higher amount than your statement balance.
• Receiving a refund for a purchase: If you pay your balance, then get a refund right after, you'll end up with an overpayment and probably a negative balance on the credit card.
• Redeeming credit card points: If you redeem your points for a statement credit, this will go directly towards your credit card balance. When the full balance is paid and the redemption isn't factored in yet, the result can be an overpayment.
• Paying the wrong credit card: People who have multiple credit cards and pay several at the same time may pay a credit card's balance on another credit card. For example, Card X might have a $1,000 balance and Card Y might have a $500 balance. The person may accidentally pay $1,000 to Card Y.

Can I overpay with automatic payments?

Your automatic payment won't cause you to overpay as long as you set it to pay your full balance. In addition, if you manually pay your full balance before the automatic payment takes place, the automatic payment shouldn't take place. The payment system should recognize that you don't have a balance, so there will be nothing to pay.

Can I overpay my credit card to increase my credit?

Overpaying doesn't increase your credit limit, and in the rare cases it happens, many card companies limit the amount you can overpay your credit card.

If I overpaid my credit card, what happens to my credit score?

If you overpay your balance, this could mean you free up more available credit, leading to a lower credit utilization ratio. Lowering your credit utilization ratio could feasibly lead to a positive change in your credit score. However, overpayment in itself may not do anything to help build your credit.

I have a negative balance on my credit card — what do I do?

You can handle an overpaid credit card statement easily. That overpayment will subtract from your new charges, resulting in a lower statement balance.

If you'd rather have the money back now, you can contact your card company and ask for a refund. To learn more about the ins and outs of credit card payments, check out our payment FAQs.