Can you go over your credit card limit?

If you go over your credit limit, your credit card company may add the over-limit amount to your minimum payment, lower your credit line, or even close the account if you’re exceeding the limit too often. Also, your credit score will drop if the balance is still over the limit when reported to the credit bureaus. That said, it’s more likely that the card’s issuer will simply decline any transaction that would result in the balance exceeding the credit limit.... read full answer

Key Things to Know About Going Over Your Credit Limit

Opt-In Requirement for Fees.

The only time credit card issuers can charge an over-limit fee is when a cardholder has opted in for the ability to exceed their credit limit.

Other Fee Limitations.

Even when you’ve given your credit card company permission to authorize over-limit charges, a card issuer can only assess one over-limit fee per billing cycle, and that fee cannot exceed the amount by which you’ve gone over the limit.

Declined Transactions are Increasingly Common.

Ever since the CARD Act of 2009, which created these over-limit rules, most card issuers have stopped charging over-limit fees. Instead, they often just decline transactions that would go over your limit.

High Credit Utilization is Bad for Your Credit Score.

Credit utilization accounts for about 20% of your overall credit score. To avoid reaching your card’s credit limit and risking significant damage to your credit score, consider paying down your balance more often, applying for a new line of credit, or asking your card’s issuer for a credit limit increase.

To see the credit utilization on each of your credit card accounts and learn how that usage may impact your credit score, sign up for a free WalletHub account and check out the credit score simulator.

How much you can go over your credit limit depends on the credit card you have. Most credit cards will not allow you to spend over the limit. While some issuers allow you to opt-in to go over the limit, you will be charged over the limit fees that are usually quite high.... read full answer

What you should know about going over your credit limit:

• It is best to avoid spending over your credit limit. Not only does it indicate unsustainable spending habits and desperation to borrow, but it’s also bad for your credit standing.
• Some issuers enable cardholders to opt in to exceed their credit limit. In turn, cardholders are charged a fee for each over-limit purchase, which couldn’t exceed the amount by which they went over.
• Even though you didn't opt in to go over your credit limit, sometimes an over-limit purchase might process. A hotel booking is one possible example. But that’s never guaranteed to happen. So, if you make a purchase that goes over and it happens to still get processed, you won’t be penalized.

Keep in mind that if your current credit limit isn’t high enough to meet your everyday spending needs, it is best to request a credit line increase.

The Capital One over-the-limit fee is $0. Capital One no longer charges over-limit fees for credit card transactions that exceed a cardholder’s credit limit.

What you should know about the Capital One over-the-limit fee:

• More often than not, a charge that goes over a Capital One credit card limit won’t even be processed, but it can occasionally happen for charges that involve holds on the account. ... read full answer
• If Capital One does process an over-limit transaction, no over-the-limit fee will be charged.
• Legally, card issuers aren’t allowed to charge over-the-limit fees unless a cardholder specifically allows the bank to process overlimit charges.

Capital One used to allow customers to opt-in for over-limit transactions, but this feature was discontinued a while back. Previously, if a cardholder opted in to the program, Capital One would process the overlimit transaction, and a fee would be assessed per overlimit charge.