The Rule of Mercy in Islam

Can we ever be guilty of misplacing mercy? Because some people in their nature is to be very soft and very generous. If you're good to those who are good to you, then what good are you? Halda Allah tells us, Halda Zal'ul Yasan. Il Lal Yasan? Isn't the reward that Allah has done you good unconditionally except that you actually do unto His creation, also good unconditionally? That's why Allah under Qur'an says, wa A'asin kamah Asan Allah, not just do good, but do good just like Allah hasdone you good.