Is the Chase Freedom Card a Visa or a MasterCard?

By: patton

11/11/2011

A reader recently wrote in to us wondering, “Is the Chase Freedom Card a Visa or a Mastercard?”

Dear Mr. Credit Card,

I keep getting offers for the Chase Freedom card but there’s nothing on the paperwork that identifies it as either a Visa or Mastercard. Which is it? Or is it completely different and therefore not accepted at many places?

Chase Freedom cards can technically be either a Visa card, or a MasterCard. Your lending bank will decide which one is issued to you. Right now, Chase Freedom is offering a $200 sign up bonus. This means that they have Visa benefits as well as specific benefits offered by Chase. In just a minute we’ll take a look at those benefits so that you don’t miss out on all of your extras. For the most part, the logo on the card only really matters in two big areas: acceptance and programs.

Acceptance

There are only certain places that these cards are accepted. So, Visa says it’s accepted more places than anywhere else, but there are still places that take everything from Diner’s Club to AMEX to Visa. So, you could end up at a place that does not accept the card you have, but you could also never really run into that problem. If you shop at places that don’t take AMEX, you might not want an AMEX. But, if you frequent places that take AEMX, getting it is OK.

Programs
The programs that come with the card are also very different depending on the logo. However, those programs are usually the ones that are in the fine print. Each company has its own special programs that are located in the fine print. You’ll see things like the 24/7 concierge service, travel insurance for bookings you make with the card, and little things like fraud protection. However, that’s as far as the logo goes.

What you get from the card begins and ends with the bank that is issuing the card. In this case, Chase Freedom cards are Visa cards. So, you are getting all the fine print stuff from Visa, but you’re also getting all the features of the Chase Freedom card. See, it’s only part of the equation.

All the Juicy Extras:

Chase Freedom offers cash back for purchases, and it has its own programs. These are all things that come from the good people at Chase. If the card were offered by a different bank, you would see that the rewards would look different.

When you earn points with the Chase Freedom card, you’re basically redeeming as if each point is worth one penny. This means that 2000 points would equal $20. That’s not a bad deal. Again, that has nothing to do with the logo. It’s just a good deal.

The sign up bonus is variable. At the time of this writing you could get $200 cash back for signing up. That will most certainly change in the future.

Since We Dealt With That

Since we just dealt with the whole acceptance and programs thing, you just have to decide if this is the card that you really want. You should compare pricing and rates for the things that you are looking at. It never hurts to check out other reviews (like ones that we’ve written for you) to see which card will benefit you the most.

Chase Freedom is accepted wherever Visa is accepted, it’s a pretty good card, but you’ll have to use our resources to find out if it’s the right card for you. Or, better yet, we can tell you right here and now.

Do other Chase Cards offer the Same Benefits?

Chase has the Sapphire card, but that card is completely different than the Freedom card. You can get cash back, but it is really a travel rewards heavy card. You get to transfer points easily and make it so that you can travel with just about any carrier and stay at any hotel.

Discover also has the Discover More card that allows you to get up to 5% cash back on qualifying purchases, and it let’s you rack up points easily in a similar format.

We could go down the list all day long, but, at the end of the day, you have to be comfortable with the card you’re getting. If you already has a Chase bank account or other accounts with Chase, it is much easier to get another Chase product and simply link your accounts online and make them easier to use.

Credit Cards and Home Loan Shopping

By: patton

11/10/2011

What happens when you go home loan shopping?

The number of credit accounts you have can affect your ability to get a home loan. How much of a balance you carry definitely has an effect.

How Many Credit Cards do you Have?

One of the first things a loan underwriter is going to look at is how many credit accounts you have. This could be everything from your car to revolving credit accounts from retailers to traditional credit cards. If every one of them has a payment, that cuts into your debt-to-income ratio. The provider is going to calculate this to see if they feel like you can afford to make their payments every month. They could care less about your other accounts, but if they feel you have too many payments going out every month, that could be a problem.

Now, some companies might simply count the number of cards you have and take that into consideration. Others might skip that altogether and simply calculate the payment totals. You just have to think about that before you go loan shopping.

What If You Have Problems With Some Of Those Accounts?

Let’s say, for instance, you had a credit card with a home improvement retailer. You never had that much on it to begin with, but there were problems with getting the payments in and getting them credited properly. So, there are a couple instances on your credit report where they reported you thirty days late on a payment.

Some underwriters might find that to be a little too much. Others will ask for a letter of explanation (which is not that hard to write, but you have to be honest because they can corroborate this stuff with customer service associate notes, etc.

You can take all of that a step further and check your credit report on your own. This means you take one of your free reports that you get every year and see what’s on it. When you find issues like this you should contact the creditor to see if you can have those reports removed from your credit report. Yes, they can contact the bureau and has this done, but you have to have a valid argument AND they have to agree with you.

Otherwise, you’re going to be writing a letter of explanation or looking for another loan provider.

How Do You Best Consolidate?

It might seem tempting to just get a brand new card and put all the balances on that one, but then you will have wiped out some cards that you have had for a long time. Good and longstanding credit relationships are very important to underwriters.

Instead of using a new card to consolidate, you should use a card that you’ve had for a while to consolidate. At the very least, you’re using you’re best-looking card to aid your credit. Plus, you will have taken care of all your smaller cards. Since the credit report shows when these accounts were paid off, the underwriter can see that you did some work on your credit.

Consolidation is not for everyone, but it is something to consider if you want to be in a better position to get a loan.

What’s The Bottom Line?

The bottom line is simple. You have to make sure that your credit is in order before you go shopping for a loan. At the very least, you need to check your report, handle any inaccuracies, and do some consolidation if necessary. Otherwise, you may end up being rejected and having to start the process all over again.

You may have had credit card fever, but there are ways to deal with it so that it is does not derail your attempts to get a loan. Just make sure you follow the steps to a healthier credit history.

Can You Have More Than One Credit Account From the Same Issuer?

By: patton

11/09/2011

Can you have multiple credit accounts with the same issuer?

A reader recently wrote in to us with this question. The short answer is, yes. We could stop the piece right here and simply call it a day, but there is one thing that we all know about credit cards and credit history. It is rarely that simple. There is fine print. There are variable rates. There are multiple ways to calculate payments. Points expire. Rewards expire. Having multiple credit cards from the same issuer may not be to your benefit. Particularly when you are trying to earn rewards.

I have multiple credit cards with Citi

I can say this from personal experience. I personally have two different cards from Citi. Now, I got them at different times. In fact, one of them was a card from another bank that is very old. It took many turns to become a card from Citibank, but, nonetheless, it is another card from Citi. They let you set up multiple cards when you manage your account online, and that’s how it works in the business.

However, there are some things that you need to keep in mind when you have two different accounts from the same issuer.

Taking Advantage of Multiple Sign Up Bonuses

Let’s say you signed up for the Chase Freedom Card to get the current $200 cash back bonus. Then you read about the Chase Sapphire Preferred card with the 50,000 bonus point sign-up offer, and signed up for it too.

It’s not that this is technically a bad thing. In fact, it’s a great thing if you can run the $500 in three months on the Chase Freedom card to score the $200 cash back, and also run the $3,000 in the first three months to qualify for the Chase Sapphire Preferred Bonus. At a minimum, signing up for both cards will net you mega bonuses. A possible con though, is that you will be paying two annual fees, and your cash back or points earnings may be diluted because you are trying to earn rewards on two cards, instead of just focusing on the benefits of one.

Credit card issuers may refuse to allow you to have multiple cards if you have recently signed up for a credit card with them. That depends on your credit score and their corporate policy (which varies from lender to lender). I have seen lenders arbitrarily deny an application just because someone had recently taken advantage of a different sign up offer with the same bank. Your mileage may vary.

What Happens to Your Credit Score?

Your credit score is affected each time you open or close a credit account. Make sure that the cards you sign up for are really ones that you want, and plan to keep. This will provide the most benefit to your credit score over time.

Your score takes a small hit each time you apply for a new account. Then, the first time you pay on that account, it usually recovers. As long as you do not carry much of a balance on your credit cards, something like that rarely matters. For those of you out there who may be carrying balances though, it is usually best to wait to apply for new credit until at least a month after you have paid off the balance on your existing accounts. This gives your lenders time to report that zero balance to the credit bureaus, and for your score to go up. At that point you are going to be more likely to qualify for additional cards.

How Does A Home Equity Line of Credit or Loan Affect My FICO Score?

By: Christina

11/08/2011

If you take out either home equity line of credit or home equity installment loan, it will affect your credit depending on which type of loan you take. And if you decide to take out a home equity line of credit (HELOC) rather than the installment loan, how it is classified in your credit reports may affect how it affects your credit as well.

To understand the situation, it is important to note that FICO classifies credit as either installment or revolving credit. Installment credit includes mortgages, auto loans and home equity installment loans. These loans are fixed and get paid off over time. Things like credit cards, on the other hand, are classified as revolving line of credit. In a typical revolving credit like credit cards, you are given a line of credit and you are free to choose how much to draw and how long you wish to pay it off.

If you take out a HEIL (home equity installment loan), then it will be clearly classified as an installment loan. The great thing about installment loan is that credit utilization is not a factor. For example, if just took out a $100,000 mortgage, and you still have $95,000 left, myFICO will not do calculations that imply that since you have 95% of the balance to be paid that it is bad. Hence, having a home equity line classified as an installment loan is a great thing.

But the situation gets a little trickier with a HELOC. In some cases, a HELOC is considered a revolving line of credit whereas in other cases, it is considered an installment loan. There have also been reports that different credit bureaus consider them differently depending on the amount of credit lines issued¹. So one might have a situation where one credit bureau reports as a revolving line of credit whereas another reports as an installment loan.

Fair Isaac (the company behind the FICO score) is not very clear about the situation as well. Their spokesperson Craig Watts has said that if the amount of HELOC is small (perhaps $10,000 to $20,000 range), it will be considered a revolving line of credit. If it was larger, it would be considered an installment loan. However, Fair Isaac has refused to put a fixed number for the cut off point!

If a HELOC is treated as an revolving loan, then the concept of “credit utilization” comes into play. If you took out a $30,000 HELOC and used $25,000 for a kitchen renovation, then that would increasing your credit utilization ratio (depending on how much credit lines you have and use with your other revolving credit like your credit cards). Hence if you intend to use up the bulk of your HELOC, it is perhaps better to get a HEIL since using up 95% is alright if it is classified as an installment loan. But it also depends on how much credit lines you have on your other revolving credit and how much you are using them. Using the same example, if you have a $200,000 limit on credit cards and using only $10,000, then using up that $30,000 HELOC would probably not do too much harm. But if you only had $10,000 in credit card lines and used up $3,000, then using $25,000 of the $30,000 HELOC will probably not be such a good idea from a credit score perspective.

Another risk you face when it is classified as a revolving credit is that if your bank perceives that your home value has fallen, it will reduce your credit lines. In fact, a lot of that happened during the financial crisis in 2008 and 2009 and many folks had their credit scores reduced as a result of that. On the other hand, if the HELOC is classified as revolving credit and you only use 10% of the lines, then that will improve your credit score because your utilization ratio will improve.

I could see another situation where having a HELOC classified as a revolving credit might help as well. For example, for someone who does not have any credit cards, having a HELOC classified as revolving credit (and using very little of it) will help give you a more “diversified” credit mix. Having a diversified mix of credit also aids your score.

References

1. Discussion of HELOC and credit reporting at MyFICO forum

The Best Hidden Visa Cardholder Benefits

By: patton

11/02/2011

There are credit cards available for every reward you could want, but that’s not always enough these days. Some credit cards offer the savvy consumer some top-notch benefits just for owning the card. After checking out these great perks, be sure to peruse your own cardholder agreement to see if you might have the same!

When you want to take in some culture but you’re short on cash, the natural thing to do is whip out your Bank of America or Merrill Lynch Visa. No, the card is not to pay for your museum entry, but to get in free. With either card, you’ll get complimentary entry into more than 150 cultural landmarks on the first full weekend of each month.

Through the Museums on Us program, you need only present your card and a photo id to gain entry, allowing you to feel even smarter while increasing your sagacity.

Wine lovers across the country dream of tastings in Sonoma County, and with your Visa Signature card, you can try them for free! At more than 60 wineries, you may engage in two complimentary tastings per cardholder, as well as save on wine purchased the same day.

Imagine whisking your favorite oenophile off for the weekend for tastings at two different vineyards. Whether you’re able to differentiate Argentinian Malbecs from their French counterparts or just want to take in the lovely views, this offers reasonably priced indulgence.

Those perks are great, but what if you’re more into sports than extended pinkies? Well, there’s a Visa for that, too. Visa Signature offers game day packages for several NFL teams, including tailgate parties, game tickets, grub, and gear.

If you’re more game to swing at a ball than watch others do the same, there are also savings on golf lessons and golfing vacations. According to Visa:

“The Challenge includes accommodations plus one day of unlimited golf, including cart, on the Arnold Palmer and/or George Fazio Course per registered guest. For the non-golfer in the group, a credit of $80 per day to use toward other activities, including spa treatments, horseback riding or helicopter tours.”

I can’t think of anyone who would want to turn that down!
Now that you’ve taken care of some indulgences, it’s time to buckle down, right? Not so fast. With your Visa it’s easy to get a great discount on everything from new shoes to spa days. While discounts change frequently, at the time of this writing you can save on products from the drug store, cruises, restaurant visits, and rental cars. Saving money on things you already need to buy is definitely the way to go!

To take advantage of these deals, just visit the shopping tab of your card’s dedicated page, then use your card to make a purchase.
While you’re there, skip on over to the giveaways page. You can enter to win a luxury vacation or a trip to Super Bowl XLVI. There’s no purchase required to enter, and no obligation, so why not enter try to win something fantastic and free?

Hands down, the best card for extra perks is the Visa Signature. This card offers preferred seating at many events, a dedicated concierge for all of your needs, and rental car collision coverage.

In addition, it offers purchase security which, according to Visa’s website, will “…replace, repair, or reimburse you for eligible items of personal property purchased entirely with your eligible Visa Signature card up to a maximum of $500 per claim and $50,000 per cardholder in the event of theft, damage due to fire, vandalism, accidentally discharged water, or certain weather conditions” within 90 days of purchase.

It also offers a warranty that doubles the original manufacturer’s warranty up to one additional year on purchases made with your card.
Whether you’re looking for ways to splurge or ways to save, your Visa card offers some great benefits. Get out there and start using them to your advantage!

Stack deals and rewards to make holiday shopping pure gold

By: patton

11/01/2011

Can you really stack online and offline sales, coupon codes, cash back, and reward points to win the holiday shopping game? We’re here to tell you: Yes! You can.

Josh Stevens is a man who committed to living off of Groupon for a whole year. While that probably isn’t practical for most of us, a holiday season driven totally by deal sites is not only possible, but a great money saving plan!

Holiday shopping can be an enormous strain on your budget, especially given the uncertain economic climate. There are ways to save big money while also giving amazing gifts. All it takes is a little luck and piggybacking great deals with good credit card rewards strategies.

The smartest way to begin is to make a list of every friend, relative, neighbor, teacher, and service worker you need to buy for. Then, as you scan the deals each day, you can easily match the recipient with a gift that would work perfectly.

With so many deal sites offering amazing discounts on products and experiences, it’s easy to get lost in the avalanche of daily emails. If you’re pressed for time, as most of us are, consider using Dealery.com. This site, “aggregates daily deals from numerous group buying and deal sites and brings them together in one place” and is available in cities both in and out of the United States.”

Now it’s time to spend a few minutes reacquainting yourself with the benefits of your cards. While it’s easy to get caught up in the cash back and airline miles, some benefits – such as a shopping portal where you obtain additional savings just for using your card – are a great resource for gift giving.

The Citi ThankYou Rewards card has an exclusive site dedicated to getting their cardholders great deals on merchandise and entertainment tickets. In addition to product discounts, there are usually additional perks. All the little perks add up, including things like a discount code or free shipping when you use your card. You’re also racking up rewards points good for products, gift cards, airline miles, or cash back using this system, called Citi Specials.

This card also offers Citi Private Pass which, according to the website, offers “discounts on concerts, theater, sporting events, dining experiences and more.” These ways to save are a great reminder that a gift of an experience can be just as meaningful as a tangible gift. While some people need a gift they can hold in their hands forever, others on your list may be open to a wine tasting, a pottery class, or a kayaking lesson.

Citibank also boasts a rewards section through Groupon, which is great because these deals can be redeemed online. If you have family who lives out of town, you don’t need clutter your inbox with deals from their respective parts of the country. You can buy the Groupon through the shopping portal, redeem it online, and have it shipped directly to the lucky recipient.

Now that you’ve used your card on a deal site, you can collect the rewards. Gift cards often come at a lower expenditure than cash back, which is wonderful if you’re not sure what to buy for a recipient.

For example, you can redeem your Discover Cashback Bonus for gift cards worth 10% all the way to 100% more than their cash equivalents. You can then use that gift card as a gift for someone else on your list, killing two birds with one seriously discounted stone.

If your credit card doesn’t have a rewards program and you’re not in a position to open a new account, you can still reap rewards. Set up an account with Swagbucks for merchandise and gift cards, Ebates for cash, or MyPoints for gift cards to build more credits.

For the ultimate in dovetailing rewards systems, use all of the above. Use your credit card with a rewards program on one of the rewards sites above, and then apply a pre-purchased deal site bargain to your purchase. It’s the best of all worlds; saving money and building rewards in two locations. As always, be sure to read the fine print. You may not be eligible if you’re already a customer of a particular business, and you may not be able to use a deal voucher along with a rewards site code in all cases.

There are other expenses of the holiday season that aren’t included in general gift giving. Hostess gifts and your own fete can cost some serious coin. Don’t limit yourself to one deal site for that holiday dinner.

A wonderful way to spread the cheer (and spare the expense) is to dovetail two or more deals. Use a Restaurant.com code and host your holiday party at a local eatery. Bring a bottle of vino from Wine Woot for the white elephant portion of your soirée. Heck, you could even use a housecleaning deal from Living Social while you’re out and come home to a perfectly tidy space. Doesn’t that sound better than picking up beer cans the morning after?

One final way to use deal sites to your advantage is to divert funds to your gift budget when you save big on everyday necessities. Snagged a deal on oil changes? Bank the additional cash in your holiday budget. Got a new haircut on the cheap? Pack some dough into your party planning fund.

There’s no reason you shouldn’t have a fabulous and affordable holiday season. By combining your rewards credit cards with the many deal sites available, you can finish your shopping early, frugally, and with little stress.

What Card Should You Get if you Have Never Used Credit?

By: Christina

10/27/2011

If you are just starting out and have not used credit, there are a few different types of “starter” credit cards that you may want to check into. Most people with no credit established will have a difficult time getting approved for the that first credit card, so you will want to choose one that works out for you and will also help to establish a credit history.

Secured Credit Cards

Secured credit cards work well not only for people with no credit but those with bad credit that are looking to repair or re-establish credit as well. Secured credit cards usually require a security deposit that the credit card company matches and as your line of credit. The security deposit is then held in the event that you should default. Some card companies even offer credit limits that are slightly more than the security deposit. When researching secured credit cards, you will want to pay attention to fees that are involved.

Prepaid Credit Cards

Prepaid cards are cards that are similar to prepaid phones and prepaid insurance. You load the card with payments or a certain amount of money, and then when you use the card, the amount used is deducted from the balance. Prepaid cards are not always issued through well known banks and often do not report to credit bureaus, which would mean they do nothing for a person starting out who is trying to build their credit history. Prepaid cards also have numerous fees and expenses for carrying the cards which make them a not-so-great solution when trying to build credit.

Student Credit Cards

Sometimes students are just starting out in building their credit histories and there are a number of great student cards that offer cash back and bonuses on things like electronics, eating out, and other things that are generally student-friendly. These cards are also pretty understanding if you don’t have a credit history and you may be able to land a good first time card with a low APR and minimal fees.

Bank Issued Credit Cards

Another alternative for first time card users, would be to check the cards that the bank or financial institution that you work with offers. Often times, if you have a relationship with the bank or credit union, they are more than happy to help you acquire your first credit card. You may also receive offers from your bank that are better than other first time user credit cards simply because they know who you are and have already established some kind of history with you.

Credit Cards Specifically for First Time Users

Both Capital One and HSBC have card programs that are specifically for first time cardholders or cardholders interested in repairing their credit. Both card issuers also allow a pre-approval application process where you are notified of which cards you may qualify for, along with the details of the card, before you actually formally apply and accept the credit card. This is extremely helpful if you want to check out which types of cards and deals you qualify for before making a decision. Sometimes through these programs, you may also qualify for a secured card that can be upgraded to a regular unsecured card after you have established a positive payment history with the card issuer.

There are a number of solutions for first time cardholders. Shop around and make sure you take your time and choose the best one that is available for you.

Do Prepaid Debt Cards Raise Your Credit Score?

By: Christina

10/24/2011

Do prepaid credit cards report to credit bureaus. The short answer is NO, they do not, hence they do nothing to help your credit score.

The reason why prepaid debit cards do not report to credit bureaus is because they are technically not credit products. They essentially act like ATM cards.

Having said that, some credit bureaus are looking at potentially making use of “credit-like” services like cell phone payments and utility payments as factors in a credit profile. The rationale is that since these services require regular payments, they could be good indicators of a risk profile of a consumer. Experian has found in some studies that these could be good indicators¹.

The reason why things like utility payments are not included in credit reports even though they have been found to be reliable indicators are that many states actually prohibit utilities from reporting to credit bureaus. Organizations like the National Consumer Law Center (NCLC) has presented evidence on why reporting utility payments should not be allowed to be reported to the credit bureaus². Their key arguments are that at present, almost all late utility payments are never reported to the credit bureaus unless they have been sold to collection agencies. Many lower income do not pay their utility bills on time because of cash flow mismatch.

Another obstacle for companies reporting payments to credit bureaus is that the FCRA (Fair Credit Reporting Act) and FACT (Fair and Accurate Transactions Act) placed stringent requirements on businesses and entities if they report information to credit bureaus. This is understandable because as a consumer you want a set of consistent rules and accurate reporting. Many firms do not have the infrastructure to do so.

Though prepaid debit cards are not reported to the credit bureaus, there are attempts to use these cards to help consumers than in its present form. For example, Suze Orman has just come up with her own prepaid debit card³. One of the selling points of her card was that your payment data will be shared with TransUnion so that they could use the data as a study to see if there is any correlation with your prepaid debit card use and credit worthiness.

American Express has also introduced a prepaid card. And on their website, they have stated that based on the usage of the prepaid card, it may result in an offer for one of their regular charge cards.

References

1. Experian FAQ: Prepaid cards do not build credit history.
2. NCLC presentation on utilities reporting payments to credit bureaus
3. Suze Orman’s Prepaid Card

Avoid Debit Fees Forever by Using your Credit Cards

By: Jason Steele

10/21/2011

The financial and political worlds are both up in arms when it comes to the latest fee hikes on debit cards. BoA started off with an outrageous $5 a month fee for using their debit card, and other major banks quickly followed suit. While everyone was complaining, a lot of people simply sat back and said, “So What?”.

Are You Leaving Money On The Table?

For those in the know, debit cards have always been a sucker’s bet. Why would I take money directly out of my bank account when I could put it on a card, pay it up to two months later, and earn rewards? Here is the scenario:

Two guys visit the web site of an electronics store to purchase a $1,000 television. The other guy puts the bill on his debit card and instantly gives up $1,000. At the same time, I put the $1,000 on one of my reward credit cards.

It boggles my mind why I would want to see my funds instantly drained with a debit card. A month later, I get a bill for $1,000, which I pay in full 25 days later. I just got an interest free loan for 55 days, but that’s not all. I also got 2% cash back, worth $20, but I am only getting started. I received extended warranty benefits and purchase protection in case my new TV gets stolen or damaged. But that’s still not all.

Let’s say, the online electronics store turns out to be one of those fly by night places from New York City, and never delivers the television. The other guy is completely screwed. His only recourse might be a small claims court in New York. In the mean time, I just call my bank and request a chargeback for items not received, and the $1,000 is credited to my account until the store can prove they delivered me the television. But I am still coming out ahead in other ways.

The other guy is paying $60 a year for the privilege of using his debit card, while my credit card may as well not even have an annual fee. For example, Fidelity Investments offers several 2% cash back cards with no annual fee.

What’s Going On Here?

Big banks are playing their customers for suckers. Do you actually buy the idea that these fees are necessary to justify their costs? Of course they are not. They made large profits off of merchant fees before the new regulations went into effect, and they will still make money off each debit card after, just less so. Therefore, they are making a fee grab strictly to boost their profits, not cut their losses.

They are betting that you will accept their justifications for their new debit card fees and pay them. They know that they will loose some savvy customers, but retain the vast majority of lazy people who don’t worry about a few dollars a month in fees. You know what, they are probably right. The people using their debit cards are already giving up a few hundred dollars a year in rewards, so why should they care about $5 a month in fees?

When Debit Cards Work

Debit cards don’t work for me because I always pay my credit balances in full and on time. Most people don’t. If you are one of those people, debit cards still have a place in your life as a method to avoid debt and costly credit card interest. In fact, that is why debit cards have become more popular in recent years, and why banks are happy to discourage their use with these new fees. Debit cards make sense if that is the only way you can keep yourself out of debt, but it just stinks that banks are using this new law as a way to raise fees and steer people back to credit cards.

What You Can Do

Short of switching to a no fee credit card, you can switch banks to one without costly debit card fees. One nice thing about the new law is that it only applies to big banks, those with over $10 billion dollars in assets. That means that only the top 60 banks in the country are affected by the law, leaving several thousand to do business as usual. These banks range from neighborhood banks and credit unions, to some fairly substantial institutions. If you shop around, you will find that there are still plenty of banks, just not the largest, that still want your business and are willing to give you a fee free debit card to earn it.

The Best Cardholder Benefits You’re Not Using: American Express

By: patton

10/20/2011

Getting the best rewards from your credit cards is important, to be sure. However, there are many other benefits in the fine print of your cardholder agreement that you may have missed. Here are some of the most notable perks of being an American Express cardholder.

American Express Purchase Protection

With the holiday season upon us, purchase protection may be the most coveted benefit of your American Express card. Things get damaged or stolen frequently, but if you bought an item on your American Express card, it is covered for 90 days. The Platinum card also covers lost items. You’re covered up to $10,000 per occurrence (with a maximum of $50,000 per calendar year) with your Platinum card.

Amex Automatic Extended Warranty

Next time you’re shopping with your American Express Green, Gold, or Platinum card, you can skip the extended warranty at checkout and save some cash. Amex will double the original manufacturer’s warranty up to one full additional year just for using your card. The protection covers up to $10,000 per item, up to $50,000 per year. This benefit is reserved for items with a warranty period of five years or less.

American Express Item Return Protection

Purchases that aren’t returnable make even the savviest shoppers wary, but when you carry the American Express card, this simply isn’t a concern. Whether you lost the receipt, the store went out of business, or it was a final sale item, if you paid with your card you’re in the green. American Express will accept the return and reimburse you up to $300 per item with a maximum reimbursement of $1000 annually.

American Express Card Event Ticket Pre-Sales and Protection

When you want tickets to shows that sell out quickly, such as Cirque du Soliel, it pays to be a cardholder. American Express offers pre-sale tickets before the general public is able to purchase them.

In an era where you’ve got to submit to non-refundable rates to get the best prices, American Express can give you a leg up. When you use your Green, Gold, or Platinum cards, the Event Ticket Protection plan can help cover the cost of your tickets in the event of a medical emergency or accident en route.

Amex Global Assist Hotline

With your card you can call for 24/7 emergency assistance with medical, legal, financial or other issues when traveling more than 100 miles from home.

Everyone’s worst travel nightmare is being helpless in a place where you don’t speak the language. Whether you’ve lost your passport or wallet, or you find yourself in a more dangerous predicament, the global hotline is there to help.

American Express Roadside Assistance Coverage

You may not need that pricy auto club membership. With your American Express Green, Gold, or Platinum card, you’re covered up to four service calls per year. This benefit is limited to $50 per incident, within the United States, Canada, and Puerto Rico.

Amex Baggage Insurance Plan

There’s nothing worse than losing your luggage. When you reserve and pay for your airfare using your American Express Platnum card, you’re automatically protected against loss and damage for a combined maximum of $3000 for checked and carry-on luggage.

If you carry a Green or Gold card, you’re afforded up to $1250 for carry-on baggage and up to $500 for checked baggage.
Before you pay to book that flight, you may want to check out your point totals. If you’re using points to pay for your flight you can “choose ‘Pay with Points’ when you book any flight online at American Express Travel.

American Express Car Rental Collision Coverage

If you rent a car using your American Express, you’re covered in the event of a collision. This benefit extends to most foreign countries and, if you’ve ever driven abroad, you know that it can be a very nerve-wracking experience. This benefit could far outweigh the annual fee in the event of an accident.

Whether you’re using your American Express card to book travel, buy drinks, or purchase gifts, be sure to take advantage of some of these insider benefits. You, and your wallet, will be glad you did!
Want to know even more? Check out our American Express F.A.Q.