The help documentation states that the Release from Credit Hold release the sales order from credit hold if the customer passes the credit check. But that is not what it actually does. It really acts as an override and releases the order to an open status regardless of the customer credit status.
Suggest is to rename the current option to “Release from Credit Hold Override”. Then it would be obvious that is what it is doing. (Not sure this is needed as it is an option to hold document on failed credit check is on the order type but perhaps there could be a use case and it just takes renaming what is currently there). Then the new option would be “Release from Credit Hold if Pass”. This would make it obvious that you are releasing only if the customer passes the credit check and brings it in line with what the documentation states.
Use case from the customer I am working with: This Customer has over 10,000 orders that they will generate at once. Some go on credit hold as they should. Payments come in and are applied to the account. It is not an acceptable practice that every time they get a payment that they have to check if the customer is on hold now, then if this payment brings the customer current, and then if the customer is current check if that customer has a Sales order and then manually release that sales order. That will not work for this client. They get hundreds of checks a day and have over 30,000 customers and thousands of open orders at a time. And they do not want to release all from Credit Hold. They want the credit hold there for a reason.
As a note, I am working with support on a resolution for this client but it was suggested to post here to get into the product for all in a future release.