PSA: Prepaying Your Credit Card May Invalidate Your Rewards

I want to start off with a definition of prepayment because it can mean 2 things. Inside the definition of “BREAK DOWN” I added some emphasis

DEFINITION of ‘Prepayment’

The satisfaction of a debt or installment payment before its official due date. A prepayment can be for the entire balance or for any upcoming payment that is paid in advance of the date for which the borrower is contractually obligated to pay it. Examples of a prepayment come in the form of rent or early loan repayments.

BREAKING DOWN ‘Prepayment’

There are many types of debts and obligations that can be settled in advance through prepayment. Consumers can use prepayments on tax forms to settle future tax obligations, they may prepay credit card charges before they receive a statement and sometimes many prepay loans through refinancing. It’s always a good idea to make sure that prepayment is allowed without penalty for mortgages, or, if there is a penalty that it’s only for a few years.

Read more: Prepayment Definition 

I think this is pretty straightforward definition and is black and white. What if I told you that if you prepaid your credit card and you would not earn points? I am here to tell you it happened to me, and I am not happy so watch out.

What Happened To Me

One (1) Elevate Reward Point for each $1.00 of Net New Purchases made everywhere else the Card is used, rounded to the nearest dollar, including but not limited to purchases of Gogo in-flight internet sessions or subscriptions, and hotels, cars, vacations or cruises booked through virginamerica.com.

It looks like Comenity needs to fix their programming logic to issue points because I did not earn 1 point for every “$1 of Net New Purchases”. They are issuing points at whatever the statement balance is for the month. I set up my Comenity issued Virgin America credit card on cruise control and every month, I will load up my US Bank Visa Buxx. Here are some examples from June to August. 

Credit Card


See that? 1042 new points


972 new points.

Both the June and July statements add up, net charges add into the points. Now let’s look at August



1006 new points on $2011.99 charges. I prepaid $1004.49 because I also had a $7.50 balance. The math for my new points certainly don’t make any sense. I prepaid it down to the statement balance to be $1000.

Credit Card


I will wait until September’s statement to close to reach a conclusion to see if the points will catch up. I will also prepay again and see what happens. If the points don’t catch up and I am losing more points, I certainly don’t want to entertain the idea of a CFPB and have Comenity look at my purchases. Thanks, but no thanks. Who knows what else could happen, the gravy train with Comenity could end if I submitted a CFPB. Someone else who lost points from more legitimate purchases should submit something to CFPB.

Potential Class Action Lawsuit?

Who knows how Comenity set up all the other credit cards. I’m assuming they use the same algorithm to issue points. If someone who is not paying enough attention to the points earning and is prepaying the credit card, they could be earning less points than what they are owed.. Definitely interesting to keep an eye on. We’ll mark this as developing. I’ll play around with my other Comenity card to see if this happens as well.

19 comments… add one
  • I think it may be helpful to actually identify which program you are talking about? You mention Elevate — is that Virgin America’s program?

    Not many people have flown them, let alone are familiar with their FF program or the bank that issues their credit cards.

    • Sorry – it was the Virgin America credit card issued by Comenity.

      • No harm, no foul.
        Thanks for the update and sorry for your tribulations.

  • The key there is ‘net’ new purchases. You’re expecting (and most companies reward on) gross purchases. Non-standard, but disclosed, so you don’t have much of a case, I think.

    • I thought net purchases meant purchases minus any returns or refunds…?

    • Usually ‘net’ means net of returns, not net of payments. It may be that a prepayment is regarded as a return by their system.

      Comenity’s thinking: who in their right mind pre-pays a credit card anyway? People who are trying to game the system, that’s who! And we shouldn’t reward them for it.

      • I have prepaid when I have purchases that would put me over my limit otherwise. Totally legit.

        • I’m with @Bryan on the definition of net purchases, @Russ, that’s what I’m afraid of.

          @Marvin that is an interesting data point. I’ll have to wait for next month to see what shakes out

  • So if you have a big charge outstanding on your cycle date, and then that charge reverses the day after, you still get points for it?

  • On second thought, @chasingthepoints, how did you pay? Did you have Comenity ach-pull from your bank, or did you push a billpay in to them? If it was a pull, then they should *know* it was a payment not a return.

  • I think the most likely explanation is that the 8/23 purchases were too close to your statement date and will be posted next month. 502.5 + 502.5 + 1.99 = 1007. Still off by a point, but I think it’s more likely than them reducing “net purchases” by payments.

    • I hope so – the math just doesn’t add up which concerned me. Hopefully I have something to report back next month

  • The points should show up next month. I had this CC and the exact thing happened to me but I called Comenity and and they stated that sometimes the points get delayed. However, I am not sure if this will automatically post the following month or if my phone call had anything to do with it posting the corrected amount the following month.

    • Thanks for the data point! I’m not going to call them and we’ll see what happens then we can compare notes if it’s automatic or requires a phone call

  • I’m on the edge of my seat for this one…now I feel like I need to go check my points too, I have just been trusting them and not checking points earned vs. posted.

    • Me too – but I was watching this card and was like, huh? 1000?

      I thought of you as soon as this screw up happened

  • Very important post here! It’s so important to be on top of issues with credit cards like this – especially if the reason you got that credit card was the rewards it offered. Thanks for sharing this!


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