Electrical – How do GFCI breakers behave on two wire circuits

Sounds like the circuit is sharing a neutral with another circuit.

With your GFCI breaker installed, turn off all other breakers. Reset the GFCI breaker, which should now hold. If it does not hold, then you have a problem with the wiring on that circuit and need to open each box to investigate.

If the GFCI breaker does hold, turn each breaker on one at a time until you find the circuit that trips the GFCI. This is the circuit with a shared neutral.

You then need to open switch boxes, light boxes, on both circuits to figure where the neutrals were wrongly tied together. Suspect anything that looks like a homeowner addition, or fix. A common place this might happen would be in a switch box that controls different lights, with two or more circuits feeding the box. An unknowing DIY-er may have tied all the neutrals together.

The GFCI is shot, the internal circuitry failed, the voltage measured on neutral may be a leakage from the damaged circuit very little current available but that’s probably why you are reading voltage. Why it did not trip the circuit breaker probably same issue the neutral opened. There are several different types of circuits used by the different companies so it is hard to tell the true cause. I do see failed GFCI’s regularly where garbage disposals are connected and less often but still several times a year where a vacuum cleaner is used on the circuit. These motors are very hard on the electronics in my experience.