There are few things in life more embarrassing than having your credit card declined, especially if you're attempting to make a purchase while you have people with you ("Hey, boss! I'll get the check!" Oops…). But before you slink away in shame, consider that there are a number of reasons your card could be declined, and only a couple of them are your fault.
Here are six popular reasons your credit card purchase could be declined:
1. International purchases
If you flew to Paris to propose on a whim, chances are you forgot to call your credit card company and tell them you were no longer in the USA. This reason alone can get your purchases denied, as credit card companies track your spending locations pretty closely. If you suddenly pop up in a location far from home, you could be shut down. Which leads to:
2. Fraud protection
This is a big deal; according to Norton by Symantec, those computer security folks, 14 adults were the victim of a cyber crime every second, amounting to 431 million people last year. To help combat this, most credit card companies, such as American Express, offer pretty intense fraud protection services. If you're spending may be a grand a month then suddenly you spend $10,000 on one purchase, red flags are going up and the transaction could be denied until you verify your identity. Suspicious activity and irregular activity are two other items AmEx monitors, so anytime you deviate from your normal location, types of purchases or frequency you could be flagged for denial.
3. Addresses don't match
Life gets busy sometimes, and if you move and don't correct your information with your credit card company, you could find yourself being rejected at the register. This one can generally be cleared up with a phone call, but to avoid the hassle make sure your billing and mailing addresses match when you're asked to supply that information in the store.
4. Over the per-day spending limit
This one straddles the line of blame; many credit cards have a per-day spending limit set on them, but a lot of card holders have no idea about that limit. Limits are often set based on the individual and their spending habits, so if you're unsure if your card has a limit, a phone call could head off that embarrassing moment. For the record, almost all debit cards come with daily spending limits and withdrawal limits as well.
5. Late payments
Maybe you forgot to buy stamps, or you figure it's not "that" late, but whatever your reason might be for sending a payment after the due date, consider it a bad idea. Not only is it likely you'll incur late fees, but there's a good chance you won't get any more credit until you've made your account current.
6. Over your credit limit
So this is the reason we all dread and causes us the most chagrin, because it is our fault. The majority of credit cards are issued with set spending limits, based on your credit history. If you run your cards close to the limit, you can almost expect to be denied when you try to make a purchase that puts you over the edge. Luckily, this is one of the easiest denials to avoid; keep your balances low.
Did your credit card get declined? If you know your balance is lower than your limit, are sure you mailed your payment on time and you haven't moved in years, then it's time to make a phone call to your credit card issuer. If your account is current and intact, meaning no one half way across the world is trying to buy a new car, you should be able to verify whatever information the issuer is seeking right over the phone. If your card information has been stolen, your account will probably be frozen until a new card can be issued. If it's an important situation, it may be a good time to use the back-up credit card in your wallet. But as most stores are happy to hold an item for a few days, you might still be able walk away with no embarrassment.