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Why was my credit card declined?

Wondering why your credit card declined and what to do about it?

Knowing that it happens all the time to lots of people doesn’t make it any less embarrassing or stressful when your credit card gets declined. If that has happened to you, here are some potential reasons why and suggestions as to what you should do about it.

credit card declined

You’ve hit the limit

“One of the most obvious reasons that your credit card may get declined is that you’ve reached your limit. Maxing out your cards is not a good idea for a number of reasons. Firstly, you can find yourself in an embarrassing situation when you’re at the point of purchase and get turned down. Secondly, having your credit balance pushed up to the limit is going to harm your credit score,” says Jeff Schwartz, Executive Director, Consolidated Credit Canada.

“If your balance is that high, there’s also the possibility that you’re spending beyond your means or that you aren’t tracking your spending, both of which could lead to problematic debt loads,” says Schwartz.

To avoid this particular problem, only use your credit card for specific purchases and plan to pay them off every month.

You’re on the road

However, if you’re travelling and are simply trying to make a purchase, this can be problematic. You can avoid this by notifying your credit card company prior to you going on your trip so they’re aware of the likely geography for upcoming charges.

If you swipe your card outside of your resident state, then a freeze can take place. Your credit card company will flag your card to avoid fraudulent charges. They will often freeze the card, just to be on the safe side.

You’re not making payments

If you’re behind on your card payments, your credit card company may very well freeze your card. It’s important that you make your payments on time, not only to avoid your credit card being turned down but because maintaining a good payment history is the biggest criteria in determining your credit score.

A lower limit

If you’ve had problems with making payments, credit card companies may bring your limit down. They usually will notify you before they do this, but it’s a good idea to check your accounts regularly, just so you’re aware of your account’s standing.

A major purchase

If you’re making a major purchase, your credit card company might freeze the account. They will usually do it when it’s outside your spending pattern or if you make multiple big-ticket purchases. If you’re intending to use credit for a major purchase, notify your card company beforehand.

You’ve been a victim of fraud

If your credit card company believes that your credit card has been exposed to fraud, either when shopping in the store or online, your card will likely be declined until you can sort out the situation.  This is not a penalty, but for you and your creditor’s protection.

If this is the reason, then after you’ve talked to your credit card company order a copy of your credit history. You want to ensure that this fraud has been isolated to this single card. It’s important to be proactive.

Have you been having trouble making credit card payments, or find that you are frequently maxed out? Take steps to pay your debt down today.  Call us at (855) 895-2684 or visit our free online debt analysis.

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