This is going to sound weird... but... lets say your credit card had a limit of, say, $3k, and you went $15k over that limit. I'm not talking about spending $15k on one purchase. I'm talking about making, for example, 30 $500 purchases all in one day. Are credit card companies fast enough to cancel the purchases that went over the limit? Mine doesn't seem to be, but I really don't know (Amazon Chase Visa card.) I know that you have to pay an over limit fee, but I don't mind that one time fee as I will be paying it all back the next month.
2006-11-08 14:59:27 · 12 answers · asked by jeffy373 1 in Business & Finance ➔ Credit
Well you might get 'lucky' and be allowed to charge all that to your credit card, but it is highly unlikely. If your limit is only $3,000 you probably have average credit. If you try to run 30 x $500 purchases in one day, more than likely your credit card will be blocked as soon as you go over the limit. So you will only be allowed to make one or two transactions beyond the limit before you are locked out.
Once you are locked out you will be charged $39 for going over the limit. You may also be charged an additional fee for each attempt to go over the limit. They may also up your interest rate to something crazy like 34.9% APR.
Next they will flag you as someone who does not keep agreements. This will preclude you from lower interest rates, higher credit limits, and other nice things. It can potentially affect your credit score too, since your high credit and limit are recorded on your credit report. Other lenders will see that you went over your limit, which will harm your ability to get other credit in future.
Which ever way you look at it, if you had some weird idea like buying 30 Sony Playstation 3 consoles and selling them for a massive profit on eBay, it ain't going to work. Your credit card company will severely punish you and lock you out long before you can go $15,000 over the limit.
2006-11-08 16:31:05 · answer #1 · answered by ZCT 7 · 0⤊ 0⤋
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2016-04-14 08:19:38 · answer #2 · answered by ? 3 · 0⤊ 0⤋
Credit card companies cannot cancel card purchases for merchandise you received. The merchant taking the card has the responsibility to get the transaction authorized and would therefore not be paid by Amazon Chase for the things you bought.
Once a card is authorized, a "hold" is generally placed on the available credit to limit the amount you could go over your limit.
What the heck did you buy?
2006-11-08 15:05:09 · answer #3 · answered by Anonymous · 0⤊ 0⤋
You obviously are living in Utopia expecting something for nothing and looking for ways to "pimp" the system like a prostitute.
The credit card companies have automatic update of your credit card balance after each ON-LINE sale is made. Once you reach your credit limit, the credit card company will review your account and approve/decline transactions that exceed your credit limit on a case-by-case basis based on your account history and other factors. Normally, however, they will start declining transactions AT THE POINT OF SALE, when you exceed your credit limit by a certain amount.
Each merchant is supposed to call their credit card servicer to obtain an authorization code for the customer's purchase. The credit card servicer will verify through the Visa/Mastercard/Discover network that the customer has sufficient credit line to purchase the item/service and issue an authorization code to the merchant for reference and payment purposes.
If the merchant is stupid enough to complete your credit transaction WITHOUT dialing the credit card company for the appropriate AUTHORIZATION CODE, then the merchant could stand to lose the total amount of the credit sale. In order to get paid CASH for the amount of their credit sales, the merchants need these valid authorization codes.
Besides, going over your credit limit damages your FICO score as it is not considered a responsible use of your credit.
2006-11-08 19:30:24 · answer #4 · answered by DaMan 5 · 0⤊ 0⤋
It will not always be caught.
An accidental overlimit can happen.
However, 30 $500 purchases in a day would generally be considered fraud - even if you pay it back the next month - as this is obviously not accidental.
In addition to the over-limit fee - it'll also go on your credit report.
They may also lower your credit limit or cancel your card.
Read your agreement with the card issuer for the details.
2006-11-08 15:18:16 · answer #5 · answered by Jon W 5 · 1⤊ 0⤋
Credit card purchases are authorized on the spot. If you are over your limit, further purchases will not be authorized.
There are some exceptions to this. The CC company may let you go a little bit above your limit as a courtesy. And if they make tons of money in penalties and fees if you go over your limit, they may allow it. But generally they will not.
2006-11-08 15:03:40 · answer #6 · answered by Lisa A 7 · 0⤊ 0⤋
Credit card companies don't cancel purchases. They either authorize credit card transactions or they don't. It's doubtful that Chase will let you get that far over the limit before shutting your card down cold.
2006-11-08 15:49:55 · answer #7 · answered by Anonymous · 0⤊ 0⤋
Even if you weren't over your limit, your credit card company would start denying your transactions. They would think your card was stolen.
2006-11-08 15:09:21 · answer #8 · answered by Anonymous · 1⤊ 0⤋
Everything is computerized these days. Once you go over your limit I am sure the company will cut you off.
2006-11-08 15:03:17 · answer #9 · answered by Anonymous · 1⤊ 0⤋
You may go over a little, but it will be denied very quickly.
2006-11-08 18:17:18 · answer #10 · answered by Vegastitan 2 · 0⤊ 0⤋