New CC card "fun" tactics.. Re: rewards..

[C.Ann]

For those who use CC's and carry a balance, make sure your payments aren't late!!

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http://news.yahoo.com/s/ap_travel/20...edit_card_fees

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Another credit card fee is about to fly

Wed Nov 18, 11:33 am ET

ATLANTA – Another fee is coming in the new year for airline and hotel customers — this time from your credit card company.

The message: Pay your bill on time or forfeit the miles or points you thought you earned for making purchases on your card during that month.

To get the rewards back, it's going to cost you.

American Express Co. is sending notices to customers who hold its cobranded cards with Delta Air Lines, JetBlue, Hilton Hotels and Starwood Hotels, that beginning in January rewards won't be transferred to loyalty accounts with those partners if you are late paying your bill.

You'll be hit with a $29 reinstatement fee if you want the rewards back. That fee is on top of the late-payment fee — $19 or $38 depending on your balance. A penalty interest rate, currently 27 percent, would be assessed on future balances.

American Express is changing the policy for its cobranded cards to align those cards with its other Amex cards that have carried the same policy for months or years.

The policy doesn't just affect the habitual late payer, it affects everyone, said John Ulzheimer, president of educational services for Credit.com. "I think over the course of time, people miss a payment at least once because of unforeseen circumstances like something getting lost in the mail or a long vacation taking your focus off making your payments," he said.

Other card issuers, like Citigroup Inc. and JP Morgan Chase & Co., also have cobranded credit cards with airlines and hotels. Citi is paired with American Airlines. Chase is paired with United Airlines and Marriott International Inc.

Citi spokesman Mark Rodgers said points earned on the company's Citi cards that offer rewards through the company's own rewards program may not be available for redemption if a card holder pays late one month, and in some cases a fee for reinstatement may apply. Rodgers said Citi is not considering reinstatement fees for its cobranded cards with American Airlines and Hilton.

JP Morgan Chase spokeswoman Tanya Madison said that if an account is past due for the cobranded United card, a customer will not earn miles until the account is paid. "While we do not go back and confiscate miles, we will stop awarding miles on spend going forward until the account's paid in full," Madison said.

Consumer advocates aren't surprised by American Express' move considering tough new rules for credit card companies scheduled to go into effect in February. Under the new law, lenders won't be able to increase rates on existing balances unless a person is more than 60 days behind on a payment.

"Essentially if you can't charge one fee, you create a new fee," Ulzheimer said.

Banks deny that they are increasing rates ahead of the February deadline and blame fee increases on the economic downturn. American Express isn't saying how much revenue it expects to generate from the new reward reinstatement fee for cobranded cards.

American Express spokeswoman Desiree Fish said her company currently transfers Delta SkyMiles to its cardholders' loyalty accounts for eligible purchases even if they are late paying their bill.

She said that in addition to changing the policy for cobranded cards to be in line with its other cards, American Express also wants to "incentivize good behavior, to say you should pay on time, and if you don't there are penalties."

Delta said in a statement that the changes to American Express' terms and conditions are consistent with changes across the credit card industry and also include new benefits for Delta customers, including the ability to earn unlimited SkyMiles for purchases on the credit card each year.

Here are some steps you can take to avoid the headache of losing your airline or hotel rewards earned on your credit card:

--Always know when your bill is due and make sure you pay it on time. Set up e-mail billing alerts for your card.

--Manage your account online. Schedule electronic payments using your checking account at your bank. Many banks allow free online billpay, and with major credit card companies the payments often post the same day as the payment is scheduled.

--Read the fine print. Don't throw away those legal notices you get from credit card companies. Terms and conditions are being changed all the time. Know the terms, so you can protect your credit and your rewards.

[wvjules]

I see nothing unfair about that. Don't pay the bill on time; don't get rewards. I guess since they took away the late/overlimit fee it was the only recourse they have.

[peggster]

Originally Posted by wvjules

I see nothing unfair about that. Don't pay the bill on time; don't get rewards. I guess since they took away the late/overlimit fee it was the only recourse they have.

I'm confused: the article says this would be on top of the late payment fee of $19 or $38. Does the new legislation eliminate late payment fees?

[GoldieSaysMeep]

Originally Posted by wvjules

I see nothing unfair about that. Don't pay the bill on time; don't get rewards. I guess since they took away the late/overlimit fee it was the only recourse they have.

I agree with this.

I’m no fan of cc companys. They’ve balance chased me and hurt my utilization ratios which infuriates me. I had a fixed rate loan suddenly change to a variable rate loan (thanks, BoA  ) and I must have made them mad when I paid 50% of my balance in one shot. Because a week later they lowered my credit limit to within 2K of the new balance.

But I’ve never been hit with any unfair “fees”, probably because I always pay my bill on time. Honestly, it seems like common sense to me. I understand times are tough and sometimes you just can’t pay the bills, but it seems like for many people, not paying their bills or going way over their limit is just a way of life…?

People need to learn to live within their means.

Sometimes, while reading online, I feel like I’m the only one who pays my bill on time and never deals with these problems.

For instance, I was told to read creditboards.com by someone once, to get some info and after persusing that board for a few days, I decided not to post because it seems like I already have a far better credit score than most of the people I saw there, and I have never had a charge off or delinquent account. Honestly, I did feel better after reading that board because I realized that what I thought were bad problems I had were absolutely not that bad compared to, apparently, most.

The question I had for the credit boards, by the way, was what happens if an old, old account that still shows on my report…one that I have no access to because I have not received paperwork on it for 5-7 years for instance, what if this account suddenly imposes an annual fee? How will I find out? I worry because of the 13 open accounts on my CR, I only have 2 cards and one personal loan I pay off of a web site. The others I have had no contact with in over 5 years, none of them have any balance and they are basically just sitting there helping my debt to credit ratio. Does anyone on the DIS have any experience with this?

[wvjules]

Originally Posted by peggster

I'm confused: the article says this would be on top of the late payment fee of $19 or $38. Does the new legislation eliminate late payment fees?

It was my understanding that the new legislation did infact eliminate over the limit and late payment fees. If I am wrong, someone will correct me. lol

[eliza61]

Originally Posted by GoldieSaysMeep

I agree with this.

a way of life…?

People need to learn to live within their means.

Sometimes, while reading online, I feel like I’m the only one who pays my bill on time and never deals with these problems.



?

You know Goldie, some times things happen in life. 1 late payment does not mean you are "Living beyond your means" . Jeez people My mother in law had her car broken into and they stole her bag with all her bills in it. It took her a while to contact the police, credit card companies etc etc. She was 1 day late and according to you she's a dead beat.


I'm glad you never have problems and don't have to deal with these things but could you cut the rest of us a break from the broad stroke assumptions.

[eliza61]

Originally Posted by wvjules

It was my understanding that the new legislation did infact eliminate over the limit and late payment fees. If I am wrong, someone will correct me. lol

The new legislation says that a payment has to be at least 60 days late before outrageous charges can be assesed. This is to protect the people who doing honestly pay their bills but because of some thing as simple as a pocket book left in a cab, can cause a payment to be 1 hour late.

[crisi]

I make token payments every two weeks on the cards I carry. I pay the bill in full when it arrives, but just have an automatic payment set up for a "minimum payment amount." I started this when I stopped trusting the card companies to get my bills to me in time for me to pay them, or credit my account in a timely manner.

ETA: Also helps in the cases of "stuff happens" - the kids bring in the mail and the bill gets set on top of the washer - only to fall behind the washer and get found a year later. I go on vacation and miss payment dates. Everyone in the house gets the flu and I'm too sick and busy to get bills paid.

[wdwfan16]

I make my electronic payments the day the bill arrives and then check my account a day or two later to see that it not only posted but cleared.

[crisi]

Originally Posted by wdwfan16

I make my electronic payments the day the bill arrives and then check my account a day or two later to see that it not only posted but cleared.

Yeah, I got caught that way, not once, but twice....with bills that arrived very late in the cycle and credits not posting in a timely manner. The time on the phone with customer service to get charges reversed...not worth it.

(I think both those things were addressed in the reform bill...both sleazy card practices. And my phone company just did it - send a bill that arrived 11/3 and was due 10/30).

[wdwfan16]

Originally Posted by crisi

Yeah, I got caught that way, not once, but twice....with bills that arrived very late in the cycle and credits not posting in a timely manner. The time on the phone with customer service to get charges reversed...not worth it.

(I think both those things were addressed in the reform bill...both sleazy card practices. And my phone company just did it - send a bill that arrived 11/3 and was due 10/30).

Each time I pay a bill I check back a month to see what else I paid at that time. I wait a few days and then call or login to see what I owe and then send the electronic payment.

I think it helps when you only have a limited number of different things to pay. We route many to our CC and only pay the ones that don't let us to that or that charge a fee to do that.

[C.Ann]

Originally Posted by wvjules

I see nothing unfair about that. Don't pay the bill on time; don't get rewards. I guess since they took away the late/overlimit fee it was the only recourse they have.

Did I miss the part where anyone said it was "unfair"..

Just a PSA for those who use CC's - count on the rewards - and then "life gets in the way"..

I don't use CC's at all - just thought it might be helpful info for those on the BB who do..

[Free4Life11]

I'm not surprised. They are starting to charge fees for everything. I've never had a late fee, but I did get hit with an over the limit fee when the interest put me $3 over my limit.

What bugs me is when you call or log in, they tell you you have $50 available credit or whatever knowing full well you are going to be charged interest. Unfortunately, I had a balance transfer offer that I forgot was expiring that month and the interest was higher than I expected.

Next month I called to ask what my beginning balance was so that I could personally calculate the average daily balance and interest rate. They were unable to provide me with any information; the only amount they could tell me was my total balance on the specfic day I called, but they couldn't tell me how much of that balance was at my purchase interest rate or how much was at my balance transfer rate.

I can't wait until my cards are paid off then I am done with credit cards for good.

[GoldieSaysMeep]

Originally Posted by wdwfan16

I make my electronic payments the day the bill arrives and then check my account a day or two later to see that it not only posted but cleared.

I have paid my bills online since I could do this. Years now. Probably at least 6 or 7 years.

I don’t even get paper statements on two of my 3 with balances. I look at them online.

This is why, quite frankly, it baffles me when people say the mail got lost or something like that. I don’t personally know anyone who pays their bills by snail mail anymore. Maybe it’s a regional or generational thing? I’m in my mid 30’s and have paid my bills like this for literally as long as I can remember. And so has my mom who is in her 60’s…

I would not trust my bills being paid on time to the postal service and the mail room at these cc companies. I pay online and get an instant email confirming that I paid. I don’t even use my bank’s billpay service to pay, I pay right off the cc company web site. It’s free. It takes 20 seconds. It assures that my bills are paid at least a week before they are due.

I never said a person who misses one payment is a deadbeat. However, it makes NO SENSE to me that a person who pays on a bill every month would not be aware of when that bill is due to prepare to make a payment on that date. It’s generally the same date every month.

Are they a deadbeat? No.

Are they living beyond their means? Not necessarily (although if they can’t afford to make the payment until the day it’s due, they probably are).

But…Are they incredibly unorganized? Absolutely.

For as long as I can recall, I have kept not only a computer spreadsheet of all my due dates and balances and amounts owed, but I also write this basic info down on a plain old fashioned wall calendar I hang at my desk. (ie. 17th car payment due -$227, 30th Best Buy card due -20 ).

[bumbershoot]

Originally Posted by GoldieSaysMeep

I had a fixed rate loan suddenly change to a variable rate loan (thanks, BoA  ) and I must have made them mad when I paid 50% of my balance in one shot. Because a week later they lowered my credit limit to within 2K of the new balance.

LOL. My hubby and I have fun conversations about what Chase's computers are "saying" when they receive our payments. We decided that we hated owing on the car, and hubby tried to refinance with them (we agreed to sick and wrong interest b/c they were the only ones who would give him a loan since he had no credit history for the last 10+ years), but they turned us down. That just made us angry like the Hulk, and we've started throwing everything we can at them.

I just paid the December payment in November, and now we don't own until February. No explanation, just "next payment due in February". Of course we're not taking them up on the "kind" offer, b/c we know very well what sort of interest would be racked up during that time...

But we imagine the Chase computers saying "wait, what? what's happening? their balance is going down by thousands! help! if only we'd refinanced them! we miscalculated! quick, give them a 2+ month "grace" period!"

We have fun in strange ways 'round here...



But I think that the fee to get the rewards "back" is semi-reasonable, as long as everyone knows about it...