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How Does LendingTree Get Paid?

LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
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Advertising Disclosure

LendingTree is an advertising-supported comparison service. The site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products. We are compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order).
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What Is a Negative Balance on Your Credit Card?

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Have you ever logged into your credit card account to check your statement and seen a negative balance? If so, your initial reaction may have been one of panic. But having a negative credit card balance is actually a positive thing. It indicates that the credit card issuer owes you money, instead of the other way around.

If you have a negative balance on your credit card, it simply means that your account balance is below $0. So instead of owing money to the credit card company, the company owes the amount of the negative balance to you.

There are a few reasons why you may have a negative credit card balance, including:

  • You overpaid your account balance. If you pay more than your existing account balance, you’ll end up with a negative credit card balance.
  • You received a refund. If you returned an item and received the refund after paying your account balance in full, or if the refunded amount is more than your existing account balance, it’ll result in a negative balance.
  • You received statement credit. If your credit card offers statement credits to cover certain purchases or allows you to redeem your rewards as statement credits, you’ll end up with a negative balance if the credits exceed your existing balance.
  • Your credit card issuer agrees to waive a fee. A negative balance can occur if the credit card issuer agrees to waive a fee, like an annual fee or interest charges, after you’ve already paid your balance.
  • A fraudulent or disputed charge gets reversed. If the amount of the reversal exceeds your account balance, it could result in a negative balance.

If you have a negative credit card balance, nothing really happens. If anything, you can rest assured knowing that you don’t owe money to the credit card company. However, it won’t help boost your credit score or increase your credit limit.

That said, if you consistently pay your account balance on time and in full each month, you’ll build a positive payment history and avoid incurring interest charges. In addition, if you charge less than 30% of your credit limit, you’ll keep your credit utilization ratio low. These steps can help improve your credit profile and increase your credit score over time.

If you don’t take action, the negative balance will automatically get applied against future purchases. So simply using your credit card to make purchases that equal more than the existing negative balance will cancel it out.

You can also request a refund from the bank. Depending on the issuer, you may be able to do this online, over the phone or in-person. For example, to request a refund from an American Express credit card, you must log in to your account, choose the account with the negative balance, select “Open a Payment Dispute,” choose “I have a credit balance on my account” and click “Continue.”

You may also be able to transfer the excess balance to another credit card from the same issuer.

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