What Happens If Your Credit Card Payment Bounces or Is Returned?
This guide explains what happens when a payment is returned, the fees involved, and how to keep it from hurting your credit.
What happens when a payment is returned
A payment usually bounces because of insufficient funds in the bank account or a closed or wrong account number. When that happens, the issuer reverses the credit, so the balance you thought you paid reappears, and any available credit the payment freed up is taken back. In effect, it is as if the payment never happened.
The fees involved
Two fees can stack up. Your card issuer may charge a returned payment fee, often around the same size as a late fee, and if the reversal leaves you past your due date, a late fee can apply too. Your bank might also charge its own returned-item fee. These are worth heading off by fixing the payment quickly.
How to limit the damage
Move fast: make a new payment from a funded account as soon as you notice, and call the issuer, since a first-time returned payment fee is often waived if you ask nicely. Crucially, a returned payment does not hit your credit as a late payment unless the account goes 30 days past due, so paying again promptly usually keeps it off your credit report. Setting up reliable autopay from an account you keep funded prevents a repeat.
- A returned payment is reversed, so your balance goes back up.
- You can be charged a returned payment fee.
- A late fee may apply if the payment is now past due.
- It is not reported as late unless it passes 30 days.
- Paying again immediately keeps the damage minimal.
Frequently asked questions
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