Negative Balance on Credit Card: What Can You Do?

Article Summary:

A negative credit card account balance is typically a good thing. It means that you are getting money returned to you in the form of a refund, or that you’ve overpaid your credit card balance. In certain circumstance, though, a negative balance can require some action on your part, such as when you want a cash refund by direct deposit or check.

In the world of finance, both personal and corporate, having a minus sign next to a balance is more than likely not good. If you are raising money for your company, and the Excel model you have created has a negative ROI (return on investment) or IRR (internal rate of return), that’s not a good thing. This means that your potential investors will lose money investing with you at some point.

Likewise, if you check your bank balance and you see a glaring negative sign next to your statement, this is also not ideal. You probably made an error in your personal budget and overdrew your account. However, if it happens that you check your credit card statement and see a negative balance, you have nothing to worry about and should just relax. In most cases, having a negative balance on your credit card is a positive. It means you have “flipped the tables” on the credit card company, and now they owe you money!

Causes of negative balances on credit cards

In general, you shouldn’t worry about having a negative balance on your credit card. If that negative balance on your card makes you uncomfortable for some reason, and if you just want to get your card back to the $0 target balance as quickly as possible, there are easy ways you can achieve your objective.

Credit card companies make their profits in the following way: They lend you money by paying for a purchase or issuing a cash advance and then charge you the principal you’ve borrowed plus, if you don’t pay the full balance within a specified amount of time, interest. In the case of cash advances, they may charge an additional fee and start adding interest immediately.

Your monthly credit card statement may include purchases, cash advances, balance transfers, and interest accrued on any balance you left outstanding the preceding month. If your ending balance on the statement is a positive amount, this is the amount you owe the credit card company. If the balance is a negative amount, then you don’t owe the credit card company anything. In fact, they owe money to you.

If you have a negative balance on your credit card, it is most likely because of one of the reasons below.

Key causes of a negative balance

Having a negative balance on your credit card bill usually results from one of the following issues:

  • Refund issued to a card with a $0 balance. For example, if you get a refund for a returned product after paying off your credit card balance, the refund may appear on your card as a negative balance. You can also get a refund due to an error correction or as goodwill compensation for poor service.
  • Overpayment. If you pay more on your card than the outstanding balance, your overpayment may appear on your card as a negative balance. Perhaps you paid extra to cover some new purchases not on the latest statement, but you miscalculated and ended up paying too much. You might also overpay due to a miscalculation if you routinely make an early payment, such as when doing the 15/3 credit card hack.
  • Cash-back rewards issued to a card with a $0 balance. Some cards offer cash-back rewards programs. (Many issuers remove the hyphen and call these programs “cashback rewards.”) If you have consistently paid off your credit card, and your balance is typically at zero, the credit for your cash-back rewards may show up on your card as a negative balance.

Let’s look at each of these more closely.

You returned something and received a refund

Credit card companies aren’t instantaneous in the way they handle things. Many times you need to deal with both the bureaucracy of the banking system and the bureaucracy of the credit card company. If you return a product that you purchased and are able to get a refund, this might not show up on your statement right away. You might pay off the balance well before your money is returned to you.

For instance, let’s say you spent $120 on a pair of Nike Zoom Freak 4 shoes designed by Giannis Antetokounmpo and returned them a week later. The return refund might not show up for a few weeks, possibly well after you’ve paid off your balance. In this case, you had a zero balance, but it now reads — $120. You now have an extra $120 that will be credited toward your next statement. This amounts to a temporary increase in your credit limit by $120. To max out your card, you would now need to spend $120 over your credit limit, not just hit your limit.

Once you use up the credit, your balance will be back to $0 and your credit limit will be the same as it ever was.

There was a payment processing error, and you got a refund

Credit cards don’t always work perfectly. Sometimes you’ll use the credit card and have the charge denied, only to find out later that the charge actually went through and has been added to your balance. Because it involves dealing with different banking systems, using your credit card outside of the country can frequently lead to this type of error.

You can contact the vendor or the credit card company to sort out the issue, but that will take time. If you pay off your outstanding balance before noticing the issue or before getting it resolved, the correction could show up as a negative balance.

Customer service erred, so you received a refund

Another example is if you paid for a hotel, complained about the terrible service, and persuaded the hotel to issue you a refund. In this scenario, your refund might not get processed until after you pay your balance. You will then see the amount you were refunded show up as a negative balance.

Pro tip: Most credit card companies and vendors will say that it takes seven business days for your refund to reach the account. In many cases, however, it can take longer. Don’t be surprised if you forget about a refund and then see it show up as a negative credit balance weeks later.

You overpaid your balance

Most credit card companies will offer a “click of the button” option to pay off your balance. But if you somehow end up sending in a payment larger than your outstanding balance, this can result in your balance being negative. If your balance was previously $1,000, and you paid $1,100, your balance can show up as -$100.


Most credit card companies nowadays will offer various different types of reward programs. Sometimes they will offer rewards for specific purposes, and sometimes they will offer general cash-back rewards for all purchases. If you consistently keep your balance at $0 while receiving cash-back rewards — and if the cash you get back gets credited to your account rather than, say, issued as a check — these can show up on your card account as a negative balance.

How to get your credit card balance from negative to positive

If you are really keen on getting your card balance back to positive, or at least to zero, there are a few ways in which you can do it.

Spend the money right away

The easiest way to bring your credit balance back to $0 is to spend the money with additional purchases. If, for instance, your balance is -$100, go to the bar and order $100 worth of drinks. Not only will your balance change back to $0 once the bar bill is processed, but you’ll probably feel pretty good about life in general. Just make sure you take an Uber home!

Pro health tip:The preceding example is the writer’s humor, not personal finance advice nor scientifically sound health guidance. On the latter, the National Library of Medicine notes the following:

Alcohol is a central nervous system depressant. This means that it is a drug that slows down brain activity. It can change your mood, behavior, and self-control. It can cause problems with memory and thinking clearly. Alcohol can also affect your coordination and physical control.”

Whether these effects make you feel pretty good, feel very bad, or feel one then the other in sequence depends on your unique physiology. Always consult your physician before starting a new diet or going on a drinking binge to eliminate your negative credit card balance.

Ask for the negative balance amount to be sent directly to you

Suppose your negative balance is quite high (-$1,000 or greater). Many credit card companies will be willing to send that amount of money back to you. They will do this either through direct deposit or by mailing a check to your address. If it’s a direct deposit, you can check your bank account after a few days to confirm you’ve received it. In fact, the Truth in Lending Act requires that any negative balance greater than -$1, in addition to being credited to your account with the card issuer, must be refunded to you upon written request.

Contact the credit card issuer

If you are racking your brain and can’t figure out why you have a negative balance, contact the credit card company. In most cases, the meaning of credit line items in your card statement will occur to you after some thought. If it doesn’t, calling the card issuer for details should clarify things. The best way to keep on top of things is to review new transactions on your card account frequently and request clarifications right away for any suspicious or unexpected items.

Leave it

Honestly, the easiest thing to do is just leave it. Most negative balances will sit in an account for 60–90 days. This gives you plenty of time to make additional purchases or even contemplate if you want to continue to use the same credit card. In reality, unless you get anxious easily every time you see a minus (-) sign, it’s probably best to leave it for a while. As a negative balance is usually a positive, you have nothing to worry about.

At the end of the day, it’s a positive!

Remember, at the end of the day, having a negative credit card balance is a good thing. You probably are dealing with a whole host of issues in your daily life that should take precedence over the negative balance on your personal credit card. Rest assured that it has nothing to do with you going into more debt or hurting your credit score. It’s just a simple way to convey that the credit card company owes you money.


What happens if your credit card balance is negative?

Nothing bad happens if your credit card balance is negative. It means the credit card issuer owes you money.

Can I get back the negative balance on my credit card?

Yes, you can get it back in the form of additional purchases or a refund.

What happens if I overpay my credit card balance?

It will result in your credit card balance showing up as negative.

What can I do if a negative balance shows up on my credit card?

If your credit balance shows up as negative, you can either spend the money right away, contact the issuer to make sure there was no error, or just leave it for a while.

Is it bad to have a negative balance on a credit card?

No, it’s generally a net positive to have a negative balance on your credit card.

Key takeaways

  • Having a negative credit card balance is generally a good thing, not a bad thing.
  • You might have a negative credit card balance because you were issued a refund due to a return or error, you overpaid, or you received cash-back rewards as a credit to an account with little or no outstanding balance.
  • If having a negative credit balance bothers you, there are several ways you can remedy it. Calling the credit card company or spending the money right away are two of the options.
  • In many cases, the best way to handle a negative card balance is to just calm down and leave it for the time being. You will surely find some way to spend the money that the credit card company owes you.

Additional reading

If you found this article interesting, why not further increase your store of practical personal finance knowledge? To continue learning, read one or all of these SuperMoney articles:

View Article Sources
  1. Alcohol — National Library of Medicine
  2. Nike Zoom Freak 4 — Baller Shoes DB
  3. Treatment of credit balances — Consumer Financial Protection Bureau
  4. Truth in Lending — Office of the Comptroller of the Currency
  5. Useful background article from Chase, Experian, Forbes, and personal finance sites — Various
  6. Best Personal Credit Cards — SuperMoney
  7. Can You Reopen a Closed Credit Card? — SuperMoney
  8. Compare Credit Cards — SuperMoney
  9. Does Overdraft Affect Your Credit Score? — SuperMoney
  10. How To Close A Chase Checking Account — SuperMoney
  11. How to Improve Your Credit Score — SuperMoney
  12. Is It Okay to Open and Close Bank Accounts? — SuperMoney
  13. What Happens If You Don’t Use Your Credit Card? — SuperMoney