Credit Card Blog

Travelers who are used to using credit cards to book flights, hotel rooms and rental cars will not flinch when it comes time to make in-flight purchases. United Airlines is imposing the credit card-only transactions on all trans-Atlantic flights as well as those to Brazil and Argentina. Now, there are few flights with this carrier that do accept cash as they already rolled out this same program on domestic flights.

Avoid Debit Cards - Either credit cards or debit cards are allowed for purchases on these flights, but if you are travelling abroad, you need the added protection of credit card services in case of theft of your cards, so taking along debit cards is not a good idea.

Use Travel Rewards Cards - Add to your points and miles totals by making purchases during flights. It’s a great reason to use your card in this way. The

Security Assistance – Using your credit cards on international flights also helps keep your money secure as there are card protection programs in place by most all card issuers.

Using credit cards for travel purposes is probably the best fit for the two entities that can be found. Add to that the travel rewards programs, and you have a marriage made in heaven. Be sure to keep your cards safe and carry a back-up card in a different location in case your primary card gets stolen or lost. Using common sense approaches like these will help your travel be more enjoyable – even when using your card for in-flight purchases.

The credit industry is in the midst of a financial storm and while battening down the hatches might keep the elements at bay for now, another impeding storm is on the horizon. Barack Obama’s new credit laws have already sent shockwaves through the credit industry and with further laws about to be unleashed it seems that the once serene landscape for the credit companies is about to become a lot more cloudy.

The new laws restrict the credit companies from making profits in the same way as before, which why they are now trying their best to cut as much waste away as possible.In the past lenders have lured potential customers with low interest rates and no annual fees that’s about to change, however, and companies are now scrambling to find ways to cut their credit lines.

Many companies are now embarking on a mass detox program, purging all inactive accounts in an effort to reduce their liabilities.Experts predict that in the coming months 20% or $1.2 trillion worth of credit will be cut and by the end of 2010 that figure is set to rise to $2.7 trillion or 50%.

It’s not just inactive accounts that are going to be cut; borrowers who are deemed “subprime” could see their credit lines disappear, as could those weak credit and switch lenders.This recent information highlights the precarious nature of the industry and the vulnerability of the credit card companies. For those who potentially face having their credit limits revoked, these are worrying times and another sign that money lenders are adopting a much more ruthless stance towards both current borrowers and prospective clients. Making sure you don’t fall into the red zone and that you maintain a good credit history is now more crucial than ever because one too many mistakes and you could find your credit line cut.

How long can one man live under an assumed (and stolen) identity? If that man is Clark Lee Mower of Seattle, the answer is 35 years.

It’s said that the worst thing you can steal from someone is their good name. According to prosecutors, that’s exactly what Mower did to his victim when he made off with the man’s identity, caused trouble with the IRS, racked up over $139,000 in debt, and declared bankruptcy.

The victim of the identity theft spent a great deal of time and effort clearing up his credit following Mower’s bankruptcy in the 1980′s. Then, when the victim tried to buy a house in the late 90′s, he learned that Mower’s activities disqualified him for a mortgage loan. Luckily, the victim was able to use the services of a local credit union that knew of the identity theft.

Mower had also been using the victim’s identity to receive government benefits and medical care. He was arrested on July 29, and faces charges of aggravated identity theft.

If you’ve tried to get a loan or even a credit card in the past year, you might have noticed how tough the lending standards have become. The Fed’s recent survey of loan officers brought tentatively good news. It looks like the credit freeze is getting ready for a long-awaited thaw.

The Fed polled US banks in July 2009. 35% of the banks reported that they’d tightened their standards for issuing a credit card. 60% of banks polled six months ago reported using stricter standards, and 65% said the same a year ago.

Experts say that banks must start lending again in order to bring about economic recovery for all. While that may be true, few of the banks that were hurt by the economic crisis seem prepared to loosen their purse strings.

In summary, the Fed’s report is cautiously optimistic. A dwindling number of banks are ratcheting down their lending, but celebration at this point would be premature. When the banks loosen up and start lending again, we’ll know the economic rebound is in motion.

With all the talk of reform and banking woes, you might be wondering if the credit card industry is really in trouble. While industry insiders would like you to believe that credit card reform is the death-knell of their business, the truth is that the industry will live on.

A recent study from Keefe, Bruyette and Woods suggests that credit cards will continue to be a primary source of bank revenue even after the new laws go into effect. And there’s more reform on the horizon; Congress is deciding what to do about interchange fees, those fees that merchants have to pay for the ability to accept credit card payments.

The study’s analysts believe that interchange fee reform will affect Capital One, American Express, and Discover more harshly than Visa and MasterCard. The latter two companies will be more affected by interest rate reform, but experts predict that all of the primary card issuers will survive the meltdown.

Credit card stocks are on the rise again, a hopeful sign that the economy is clawing its way out of the grave. This is a great opportunity for new card holders to learn from the mistakes of their predecessors.

Most of us have heard grumbling about the long delay before the new credit card rules go into place. Most of the changes won’t occur until mid-2010, but there are some important rules that will go into effect sooner. They are:

#1: 45 Days Written Notice of Change to Terms

Any significant changes to the terms of the account must be detailed in writing 45 days before the changes take place. This also goes for interest rate hikes. This gives card holders a reasonable amount of time to opt out of changes they don’t like. Prior to this change, creditors were only required to give 15 days notice.

#2: Written Notice of the Right to Cancel

Along with the written notice of changes to interest rates and terms, card issuers must provide cardholders with written notice of their right to close their account instead of agreeing to the new terms.

#3: Fair Due Dates (in February)

Credit card bills will be due on the same day every month to make it easier for cardholders to pay their bills on time. If the due date falls on a weekend or holiday, the payment cannot be marked as late if it’s received the next business day.

For the full set of rules that will go into effect by 2010, visit www.consumer-action.org and search for “new credit card provisions”.

Most people do not monitor their credit with the credit bureaus. There are two reasons for this: first, it costs money. The credit bureaus allow you to purchase your credit reports directly from them so that you can see what items they contain. Second, most people do not monitor their credit report because they are afraid of what is contained in them.

Do It Anyway – A proactive approach needs to be embraced however in keeping your credit reports clean and helping you remain aware of the consequences of not doing so. You can obtain a free report for all three reporting bureaus by going to annualcreditreport.com. You should comb through these reports and see what is there and needs to be changed if the data is in error.

Straighten It Up- Once you have copies of your reports, work with the credit bureaus to fix any legitimate errors. This will help your credit score go up eventually. This is the one of the best ways to influence your score to increase.

Face It and Change- After you see your credit bureau reports and see what is on them, you will be able to use that as motivation to change your money management activities. Pay all of your bills on time, make more than the minimum payments on credit cards, find ways to increase your income and reduce expenses.

Paying this type of attention to your credit cards and the tasks that goes with them is hard work. It is easy to get into debt, but more difficult to get out. If you make yourself do these things, then you will be able to use credit cards responsibly again. But, for now, get to work.

Heartland Payment Systems, a payment processor based in Princeton, NJ, handles about 100 million transactions a month. So you can imagine the sinking feeling their employees felt when they realized that Heartland’s computer systems were infected with malware that compromised the security of the many credit and debit cards used in those transactions. According to analysts, this could be the biggest data breach the world has yet seen.

So what data didn’t get compromised during the breach? Heartland reps assured customers that “no merchant data, cardholder Social Security numbers, unencrypted PIN numbers, addresses or telephone numbers” were involved. Unfortunately, credit and debit card numbers were likely targeted.

What can you do if you think your card details have been compromised? According to Heartland, the best thing to do is keep a close eye on your monthly statements. You can also have your cards flagged for possible fraud, and your accounts frozen. For a more permanent solution, cancel the cards that may have been breached, and replace them with new ones.

Under federal law, credit card holders are only responsible for up to $50 of unauthorized charges. Debit card holders can be liable for up to $500.

Credit cards are still good to use if you use them wisely. However, your credit score can get damaged by a few things that are caused by your own activities. Here are four that you need to steer clear of in order to keep your score up.

Cash Advances – Taking a cash advance from your credit card might seem like an innocent thing, but it is a red flag with the credit card company. They view these as a desperation move. So, why do they continue to offer them? Because they make money on them. Using cash advances to pay for daily expenses is not a good thing to do anyway. It is a sign of a larger problem that you need to address. Either, increase your income or lower expenses – or both.

High Balances on Retail Cards- Retail cards are used less frequently than other credit cards. Large balances on these cards tend to indicate fewer financial options and signal that you might be under financial stress. Make a strong effort to pay these down and then use them only for necessary purchases that you know you have an income stream with which you can pay off within a month.

Too Many Opened Accounts Too Soon – If you try to open too many credit card accounts to close together, then that is another sign of financial desperation. Even if you are in financial desperation mode, do not try to get more credit cards. You will be adding to your frustration by putting off the facing of your situation.

Unpaid Medical Bills – If you have outstanding medical bills, those will be reported to the credit bureaus and your score will go down. These types of bills are not uncommon, but you need to manage them better. One way of doing this is to set up a repayment schedule with the medical provider before the account goes delinquent. Find out what they will do to work with you. Most of these offices are used to this and will work with you.

The practice of lowering credit limits on card holders across the board has affected many customers with good credit. Since then, they have learned to be more aware of their credit limit. Making these tasks a common activity every week before you shop and use your card will help.

Check Your Limit – Make it a point to check your credit limit regularly. Once per week is not too much. If you have Internet access, you can view it when it is convenient. Tie it into another online activity that you already perform on a regular basis, such as checking your email. Or, most card issuers allow you to check your balance and other items via a phone call to their toll free customer service number. Put the number on speed dial and use it often.

Pay Down Your Balance – Work hard to pay down your balance and keep it as low as possible. While this will not keep the creditor from lowering your limit, it will help if they do by making sure that you have enough of a ceiling to absorb such a decrease.

Protect What You Have – Learn to use your credit card wisely and pay more than the monthly minimum which will help protect what you do have and make it easier to manage your balances.

Smart card holders adjust their activities to make sure they are not caught in the tow of card issuers across the board adjustments to accounts. The days of running your credit card accounts on auto-pilot are over.