A lot can happen between the time you submit your credit card payment check and the credit card issuer checks with your bank. Unexpected accounting expenses or errors can drain your bank account.
If your check is returned by your bank, your credit card issuer will pay the refund as a penalty
Lack of funds is just one reason why a check can be returned. Closing an account or canceling a check are also the reasons for the checks returned.
When you pay for your credit card online, you must enter your bank’s route number and check your account information on the credit card issuer’s website. You can also charge a refundable check fee if you enter your bank information incorrectly and your credit card payment does not process.
How much is the return fee?
A credit card company can charge up to $ 25 for a first refund within six months, and $ 35 for each postpay refund. If you have missed a payment or have had another check returned in the past six months, your credit card company may also issue a penalty rate, which is the highest rate charged on your credit card. Please check your credit card terms for correct fees and penalties for refunds from your credit card.
Tips to Avoid Return Fees
You can avoid a refund check fee by making sure you have enough money in your checking account to cover your payment.
Make sure you balance your checkbook to review any transactions that may clear your account in the next few days. You run the risk of taking a refund if you try to pay checks or pay bills in a certain order because you can’t afford everything. Unfortunately, you may also face an insufficient amount of funds from your bank.
Keep track of your checking account as you mail your credit card to make sure your balance will cover payment when it is displayed.
When making payments online through the credit card company website, make sure you enter all the information correctly, even if it means pulling out a physical check to verify your checking account information. The card issuer can suspend your account for several months, and you will be charged a fee.
You may be able to waive the fee or change it if it was a one-time event and your account history has always been positive. Call the customer service number on the back of your credit card, explain the situation, and ask for the fee to be waived courtesy.
How your payment will affect your credit
A refund cannot be applied to your credit report if you make your payment within 30 days of the due date. Fortunately, your credit score will not be affected by this error. However, if the full 30 days pass after the due date and you have not successfully completed the payment, a 30-day delay will shift to your credit report and may affect your credit score.
Make it a habit to check that your payments have started working days after you make them.
This will help you respond quickly if there is a problem with your payment, and if you can’t avoid the reimbursement charge, then you can at least save your credit.