5 things you need to know about debit and credit card holds

Mar 14, 2021

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Editor’s note: This post has been updated with new information.

If you’ve ever checked your credit card or bank account after a gas station purchase or during a hotel stay and noticed “pending” charges larger than what you’ve actually spent, then you’re likely well aware of what’s known as “holds.” A hold is an amount charged to your card when you pay for something that doesn’t have a set total, and it is required by card networks including American Express, Visa or Mastercard, for certain purchases.

Holds allow the merchant to ensure that you have the money available for your purchase. Hotels use them as a way to protect themselves from paying for any damages guests may cause, which in return, usually makes guests more respectful (which you should be anyway). In addition, it also covers any incidental purchases you may charge to the room during your stay, such as meals in the hotel restaurant or spa services.

One thing I have noticed in my travels is that the more expensive hotels will authorize larger hold amounts compared to less expensive properties. Even if you’ve redeemed points for the stay, the hotel will want a card to place a hold on, so if you’re redeeming points for a premium, luxury property, be warned that the hold amount may be substantial.

Why are holds sometimes problematic? If you’re a new credit card holder and don’t have a large credit limit or you’re using a debit card and don’t have a ton of money in your checking account, holds can prevent you from making a purchase or completing a hotel stay or rental car booking — even if you do have the amount of money needed for the actual purchase. Here are five important things about holds you need to know.

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Holds are different on credit cards versus debit cards

When a hold is placed on a credit card, it affects your available credit line. These holds are lifted once the merchant has approved the final total. Assuming you have available credit and are not close to maxing out your card, it’s almost always better to put a hold on a credit card, where your credit line is typically higher than your debit card balance. And using a rewards credit card means you’ll earn points, miles or cash back for your completed transaction.

Frustrated young woman looking at her phone at a hotel desk
(Photo by PhotoAlto/Ale Ventura/Getty Images)


When a hold is placed on a debit card, it reduces your actual bank account balance, aka your cash availability. However the length of the hold may vary, depending on whether or not you enter your PIN with the transaction. With non-PIN transactions, the payment goes through the credit card network and is processed within a few days of your purchase. This means you would not have access to your full account balance until the transaction clears. If you enter a PIN, the hold is often cleared right after the transaction because the funds are immediately deducted from your bank account.

Ask the merchant about holds in advance

Avoid being surprised with a hefty hold and ask the merchant beforehand if there will be a hold, for how much and for how long. This will not only help you decide which card to put down, but will also help you determine if you’ll need to do your spending on another card.

One instance where you may not think to ask is at a gas station. In the United States, each gas station can determine the amount and length of the hold. This means that at some gas stations, the hold can be as low as $1 or $5. While at others, it can be $50 or $100. Some stations may have signage at the pump notifying you of the hold amount and length, but if not, you may want to walk inside and ask the cashier.

Couple wearing face masks checks into a hotel, handing over a credit card to a guest services representative
(Photo by Space_Cat/Shutterstock)


Know your available credit and balance

This is a very important thing to know before putting anything that requires a hold on your card because if you don’t have an available balance or any extra credit to spare, it could result in an overdraft or straight-up decline. Another thing to keep in mind is to not tie up too much of your credit or balance on a single card. If you know you’re going to have a large hold on your account — say for a cruise reservation — consider asking for a credit line increase. If you’re not able to get that, be sure to put the hold on a card with the largest amount of unused credit.

Always have a few card options with you for instances just like this. Running into a problem could put a real damper on your travels, so come prepared. Check out our guide on the best travel credit cards to ensure you’re truly maximizing your travels.

Pay with the same card to avoid extended holds

When you check into a hotel or rent a car, the agent will typically ask you for a card to have on file in case of incidentals. In some cases, debit cards may not be accepted, as the hold may be too large.

One thing to avoid is handing over one card for the hold, but using a different card to make the final payment when you check out of your hotel or return your rental car. When you use two separate payment methods, it can sometimes take longer for the pending hold charge to be removed.

There may be ways to avoid holds on your accounts — but they’re not ideal

If you hate dealing with credit card holds and don’t want to worry about a limited credit line or balance, you could just pay in cash. You may still be asked for some sort of deposit at places like hotels, but usually when you pay cash, that’s it. The downside of this is that you wouldn’t earn any points — and if you’re reading TPG then you know we’re all about earning every point.

If you don’t want a hold to tie up your credit limit, or impact the available cash in your bank account if using debit, using a gift card can be a potential solution. Using a travel rewards credit card to purchase gift cards in moderate amounts will likely allow you to still receive points, but you should refer to the rules of your credit card account to be sure.

(Photo by Summer Hull / The Points Guy)

You may be able to purchase gift cards, either from the merchant itself, for example, to use at a gas station by prepaying inside, or you can purchase Visa, Mastercard or Amex gift cards that can be used anywhere. The balance on your gift card will need to be high enough to cover the potential hold if you pay at the pump, and you’ll have to keep track of any leftover funds on the gift card and make sure to spend them, so they don’t go to waste.

Unfortunately, using a gift card is unlikely to work for a hotel stay or any purchase where the merchant requires the name on the card to match your photo identification. You can use a gift card to pay your final bill at check out, but you’ll need a credit or debit card in your name for the hold.

Bottom line

When holds are placed on your card, it’s usually for a travel-related purchase, which is why you should always be using a card that earns bonus points for the category, like the Chase Sapphire Preferred Card. If you’re a road warrior and constantly find yourself at the pump, make sure to maximize those purchases with a card that rewards you for gas, like the Wells Fargo Propel American Express® card. And if you prefer to keep things simple, take a look at our guide to the best cards for everyday spending.

The Wells Fargo Propel card is no longer available for new applicants.

The information for the Wells Fargo Propel card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Featured illustration by Abbie Winters.

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