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.
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 Counseling Services of 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
If purchases start showing up on your account in various cities which are outside of your “usual” area, this could be a flag to your credit card company that your card has been hacked and is being used fraudulently. They will often freeze the card, just to be on the safe side.
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.
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.
Your limit was decreased
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 done, not to penalize you, but for yours and your creditor’s protection.
If this is determined as the reason after you’ve talked to your credit card company, order a copy of your credit history 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 or visit our free online debt analysis.