Credit Card Overpayment (On Purpose)

      • I have a credit card through my local credit union. I want to buy something online that is over the card’s limit, but in the past I have asked them to raise the credit limit and was refused–even though I have 10? years with this place and no bounced checks, no late car or credit card payments. As a result of the card number being stolen and a mixup in balances however, they transferred an overpayment to the card and for a short time a positive balance occured–which got me wondering: is it acceptable for me to simply overpay my credit card bill by (X) amount, and then order the item I wanted–assuming (X) is greater than the amount the item is over the card limit? When you make a credit purchase, is the credit limit checked, or just the available balance?
  • And I have contemplated sending them an official “raise this credit limit or tell me what other bank will” letter, but getting word back on that will take a few weeks at best…

When obtaining an authorization for a credit purchase, the credit line is part of the authorization, so even if you overpaid, its possible that it will be declined. And since most merchants obtain authorization nowadays, a swipe and a smile wont facilitate the purchase.

On the other hand, since the credit card company wont give you the increase, its possible for you to get a temporary increase with the extra money you send to make the purchase. You would have to work it out with someone in customer service, and usually with a level above the front line representative since the authorization and temporary change will need to take place.

You should look into getting another credit card, however, since credit union cards are not likely to have as many features since there are fees associated through Visa/Mastercard that usually credit unions are looking to cut out.

I dont work for either, but I recommend looking at Capital One or Household for a credit card. Household has quite a few lines with miles and payback offers.

This is anecdotal, but maybe someone else will have some facts to back this up.

My banker (who is very trustworthy and has gone to bat for me on a number of occasions, even when it was not necessarily in the best interest of her employer) warned me to be very wary of Capital One. After hearing that I had a credit card with them she told me in no uncertain terms that I should never, ever, ever get behind on payments with them or try to cancel the card. She has had a large number of people get denied for loans through her bank becasue of negative credit scores reported by Capital One. Negatives which would not have necessarily been reported by other creditors I myself have had no problems with Capital One, but if my banker tells me to watch out, I listen.

I know that with my Visa card I can’t purchase anything which is more than the credit limit. I once tried to put a couple of thousand dollars cash on it so I could purchase some furniture for $5000. My credit limit was $3500. The transaction was declined.

Call their 1-800 number and ask your company. There’s a good possibility that banks/credit unions have differing policies on this.

I deliberately over payed my card and was suspended. When asked Y they said its a form of fraud, or it could be, anyway it was automatic and a pain to correct. I use paypal now for some of those on line purchases.

My wife (who keeps a low credit card balance in order not to get too much into debt - she uses my card for that ;)) tried this and was refused. Though this happened in Ireland, I’d imagine the rules are the same all over the world.

Just recently I became very argry with my credit card company; namely VISA. I bought most of my X-mas gifts on the card, and ran it I figured around $350. Well, then I bought my Winter term text-books on the card. When I paid for them, I figured if I went over my limit ($500) it would be declined, and I’d just pay with debit, but all went through and I figured I was just under my $500 limit. Well, when I got my bill I found I had gone $100 over and they were making me pay a $15 fee for them letting me go over! Needless to say, after yelling with the VISA people on the phone I still had to pay the fee.

Therefore, the lesson is the limit isn’t always the limit where your card will be declined and it is your responsibility to track your own spending. So if your purchase is close enough to your limit you could just try to just purchase it and pay the over-limit fee. Or get another card who will raise your limit.

how 'bout applying the overpayment to the credit card and have the vendor bill you in 2 smaller amounts. This way each charge will not exceed your credit limit or your available balance.
-Agent Smith died for your sins!

I’ve not done it, but I’ve read here on SDMB of people who intentionally paid their credit cards way, way, over the limit to buy cars. It’s a no lose scenario – instead of paying cash for the car, you pay cash on the credit card, charge the car, and get your airline miles. I’ve not done this, but am considering it.

I do know that some banks do not allow you to overpay your credit card balance by much (i.e., Capital One limits it to 5% either of your limit or of the outstanding balance you are paying off, I don’t remember which). Any excess will be refunded to you. I also remember having other overpayments refunded to me when they exceed a certain amount (i.e., over $25).

The only card I have experience with that will happily allow overpayments is American Express. I have overpaid AMEX thousands of dollars prior to business and vacation trips so I wouldn’t have to carry lots of cash.

Most credit cards do assess a fee for going over your limit. As a merchant there are ways to do this. For instance in the last hotel I worked for… If your system went down, you were, by our merchant agreement with Visa, OK for up to $500.00. Since it is rarely down long enough occasionally you could manually get someone and check them in and have the CC declined when the system came up. Now in this instance you should get a new form of payment but if the guest didn’t have one, you still have your back covered.

Also when I billed no shows. If the charge was 200.00 and I could not get an OK for $200.00. I would authorize 4 charges of 50.00. This covered my back while probably pushing the holder over his limit.

Also NOTE Airline miles are valued at 1.8¢ per mile. So if you want to charge part of your car think of it this way…10,000 X .0018 = 180.00.

I can fly from CHGO to NYC round trip for 180.00 (not always but I’ve done it a lot in the last year for even less on American). But 10,000 miles isn’t gonna get me 1/2 way there. So use your good judgement before going this route.