diff --git a/app/models/spree/payment.rb b/app/models/spree/payment.rb
index 8126ad851c..f940db551f 100644
--- a/app/models/spree/payment.rb
+++ b/app/models/spree/payment.rb
@@ -32,7 +32,19 @@ module Spree
     # invalidate previously entered payments
     after_create :invalidate_old_payments
 
+    # Prevents #validate_source to end up in a chain of validations, from
+    # payment to payment up until the original credit card record.
+    #
+    # All payments are validated before saving thus, we get nothing by checking
+    # they are valid in the future. Quite the opposite. Stripe is accepting
+    # refunds whose source are cards that were valid when the payment was
+    # placed but are now expired, and we consider them invalid.
+    #
+    # Skipping the source validation when applying a refund avoids this
+    # situation. We trust the payment gateway.
+    attr_accessor :skip_source_validation
     attr_accessor :source_attributes
+
     after_initialize :build_source
 
     scope :from_credit_card, -> { where(source_type: 'Spree::CreditCard') }
@@ -151,7 +163,7 @@ module Spree
     end
 
     def validate_source
-      if source && !source.valid?
+      if source && !skip_source_validation && !source.valid?
         source.errors.each do |field, error|
           field_name = I18n.t("activerecord.attributes.#{source.class.to_s.underscore}.#{field}")
           errors.add(Spree.t(source.class.to_s.demodulize.underscore), "#{field_name} #{error}")
@@ -176,8 +188,12 @@ module Spree
       gateway_error e
     end
 
+    # Inherited from Spree, makes newly entered payments invalidate previously
+    # entered payments so the most recent payment is used by the gateway.
     def invalidate_old_payments
-      order.payments.with_state('checkout').where("id != ?", id).each(&:invalidate!)
+      order.payments.with_state('checkout').where("id != ?", id).each do |payment|
+        payment.update_column(:state, 'invalid')
+      end
     end
 
     def update_order
diff --git a/app/models/spree/payment/processing.rb b/app/models/spree/payment/processing.rb
index 2d01a91aea..ec7d154f66 100644
--- a/app/models/spree/payment/processing.rb
+++ b/app/models/spree/payment/processing.rb
@@ -114,7 +114,8 @@ module Spree
               payment_method: payment_method,
               amount: credit_amount.abs * -1,
               response_code: response.authorization,
-              state: 'completed'
+              state: 'completed',
+              skip_source_validation: true
             )
           else
             gateway_error(response)
diff --git a/spec/controllers/spree/admin/orders/payments/payments_controller_spec.rb b/spec/controllers/spree/admin/orders/payments/payments_controller_spec.rb
index 4f6a36f592..27ea7dac50 100644
--- a/spec/controllers/spree/admin/orders/payments/payments_controller_spec.rb
+++ b/spec/controllers/spree/admin/orders/payments/payments_controller_spec.rb
@@ -157,6 +157,8 @@ describe Spree::Admin::PaymentsController, type: :controller do
 
       let(:params) { { e: 'credit', order_id: order.number, id: payment.id } }
 
+      let(:successful_response) { ActiveMerchant::Billing::Response.new(true, "Yay!") }
+
       before do
         allow(request).to receive(:referer) { 'http://foo.com' }
         allow(Spree::Payment).to receive(:find).with(payment.id.to_s) { payment }
@@ -180,6 +182,14 @@ describe Spree::Admin::PaymentsController, type: :controller do
         expect(flash[:error]).to eq('validation error')
         expect(response).to redirect_to('http://foo.com')
       end
+
+      it 'displays a success message and redirects to the referer' do
+        allow(payment_method).to receive(:credit) { successful_response }
+
+        spree_put :fire, params
+
+        expect(flash[:success]).to eq(I18n.t(:payment_updated))
+      end
     end
   end
 end
diff --git a/spec/models/spree/payment_spec.rb b/spec/models/spree/payment_spec.rb
index 43a0a05127..144122631b 100644
--- a/spec/models/spree/payment_spec.rb
+++ b/spec/models/spree/payment_spec.rb
@@ -401,6 +401,25 @@ describe Spree::Payment do
             expect(offsetting_payment.response_code).to eq('12345')
             expect(offsetting_payment.source).to eq(payment)
           end
+
+          context 'and the source payment card is expired' do
+            let(:card) do
+              Spree::CreditCard.new(month: 12, year: 1995, number: '4111111111111111')
+            end
+
+            let(:successful_response) do
+              ActiveMerchant::Billing::Response.new(true, "Yay!")
+            end
+
+            it 'lets the new payment to be saved' do
+              allow(payment.order).to receive(:outstanding_balance) { 100 }
+              allow(payment).to receive(:credit_allowed) { 10 }
+
+              offsetting_payment = payment.credit!
+
+              expect(offsetting_payment).to be_valid
+            end
+          end
         end
       end
     end