Having your credit card declined in public can be incredibly embarrassing, especially if you don’t have a backup card handy. It feels like all eyes are on you and you can’t get away fast enough. If your card is declined, the best thing to do is call the issuer immediately to find out why. Here are several common reasons why your card purchase may not get approved.
You’ve reached your credit limit
Most every credit card has a specific limit you can spend. Usually when you’re new to credit or have a poor credit score, they’ll give you a low limit like $500 or less. Once you’ve maxed out your card, it will be declined for purchases until you make a payment. The easiest way to check your available credit is to log into your online account or call the customer service number on the back of your card. Ideally, to maintain a high credit score, you’ll want to keep your credit utilization under 30% of your credit line.
Your account was flagged for fraud
If you try to make an unusually large purchase or use your card in a foreign location, your account may be flagged for suspicious activity. When that happens, the transaction will be declined and your credit card company will immediately call or text asking if you tried to make a purchase at XYZ. Once they confirm it’s a legitimate transaction, they’ll remove the freeze and you’ll be able to use your card again. To avoid the hassle, it’s a good idea to notify your bank about your travel plans and large purchases in advance.
You entered incorrect payment information
Now that it’s almost the holidays, many stores are offering daily deals online and you have to act fast if you want to nab your item before it’s sold out. It’s easy to make mistakes when you’re rushing through checkout. If your credit card number, expiration date, security code or billing address doesn’t match what’s on file, the payment won’t go through. So, always double check your entries before hitting “submit”.
The card has expired
Trying to use an expired credit card is a surefire way to get your transaction declined. Most credit card companies will automatically send you a new card a few weeks or months before your current one expires. The credit card number will generally remain the same, but the expiration date will be different. You’ll need to activate the card before you can begin using it. Usually, there will be a sticker on the card telling you to go to a specific website or call a toll-free number to activate it. Once you’re done, you can shred your old card.
There’s a large hold on your card
When you have a low credit limit, large holds or pending transactions can really put you in a bind because that’s less money you have available to spend. Until those transactions clear, you may have a hard time making additional purchases. Hotels and rental car companies will commonly place a hold on your card to cover potential charges and damages. The hold amount will vary by hotel, but it generally ranges from $50 – $200 and lasts the duration of your stay. Once you check out of your hotel or return the rented vehicle, the hold will disappear within a few days. In the meantime, its best to go with cash and/or a backup card.
