rewrite this title What Is a Credit Card Hold, and When Should You Expect One? – NerdWallet

A credit card hold is when a merchant reserves a certain amount of money on your credit card temporarily, ahead of a big purchase. Also referred to as pre-authorizations, such holds most commonly happen at gas stations, hotels and rental car companies — typically at places where the company doesn’t yet know what your final bill might be.

These holds are temporary and the amounts held are never actually charged to you, which means they’re usually no cause for concern. Here’s what to know about credit card holds and when to expect them.

Credit card holds are a way for merchants to ensure that there’s enough available credit on your card to make a purchase. Once the final bill is paid, the hold is typically removed.

For example, when you check into a hotel, you might be asked to provide a credit card on which the hotel will usually place a hold — separate from the price of your room — to cover any potential charges, aka “incidentals.” When you check out and your final charges are determined, the hold is eventually lifted and you’re responsible for paying only the amount that you actually spent.

The same process often happens when you swipe your credit card at a gas station. For instance, a gas station might place a $100 hold when you swipe, even if you end up spending only $40. But you’ll only be charged $40 once the hold is lifted.

The length of a credit card hold depends on the type of transaction and specific merchant. Most holds are released when the final bill is paid. But others can last a few days to a few weeks. A gas station hold will typically resolve within one to seven days, but if you rent a car, for example, the hold usually lasts the entirety of the rental period plus a few days after.

While they’re typically nothing to worry about, credit card holds may briefly affect your credit utilization, or the amount of available credit you’re using. But while credit utilization is a major factor in determining your credit scores, in the case of a hold your available credit is lowered only temporarily, so your credit scores generally won’t be affected.

However, having less available credit does mean you’ll be less liquid in the moment, which could create problems with such travel-centric expenses as hotels, gas stations and rental cars — especially if your card already has a very low credit limit, is close to being maxed out, or is maxed out.