Everything About Credit Cards

A year or so ago credit card issuers were offering incentives to talk you into taking their cards, now some credit card issuers have been offering bribes to get you to give them back!

The offers came with promises of free gifts, interest-free trial periods if you’ll transfer balances, and rewards programs. When you said yes, you were also rewarded with a sheet of pre-printed checks – some of them filled in with figures like $1,000, $2,000, and even $5,000.

Just put that check in your bank account and go have fun!

But all that was last year.

Now, only a few selected consumers get offers in the mail, or “ready to deposit” checks from their current credit card issuers.

Now credit card companies want only those customers who represent low risk and high revenue. So they’ve been closing unused accounts and lowering credit limits, while increasing interest rates.

Some card issuers, while also using those tactics, took an additional step during March and April of 2009: They offered significant “bribes” to current account holders who would agree to pay off their balance and close their accounts.

The bribe consisted of a $300 pre-paid credit card, and it was offered to card holders who their scoring systems identified as consumers who might go into default in the coming months.

Most of us have been led to believe there is just one score: The FICO score. But this isn’t true. Lenders, insurance companies, and others are keeping dozens of scores on each of us. These are the kinds of scores used to predict which card holders pose the greatest risk.

Other card issuers have been offering similar, but smaller bribes to customers who have gone into default. One card issuer offered a $25 pre-paid card to customers in exchange for brining their accounts current.

This is just one more defensive step being taken by card issuers who are seeing near record numbers of defaults and charge-offs.

Closing accounts is, as you may know, detrimental to consumers. 30% of the FICO score is based on the amount of available credit to debt, and when a credit line disappears, the ratio changes – lowering the consumer’s FICO score.

Since high credit scores are required to get the best rates on credit cards, car loans, mortgages, and even retail accounts, consumers should consider their future plans before voluntarily letting go of any open line of credit.

The Slate(SM) From Chase Visa Card allows you to set up what they call a “Blueprint” for managing your credit card account. This is the perfect card for those who like to keep careful and detailed records of their spending.

If you want to set a time frame in which to pay off a balance, Chase will do the calculations for you and help you set up a payment schedule. If you want to pay off a large purchase, Chase will separate that purchase out on your bill so you can see the progress you’re making.

They’ll also help you see and track your spending trends, so you can make changes in your habit from a point of knowledge.

To be eligible for this card you must not have a bankruptcy in your past, nor can you have had any seriously delinquent accounts. You must not have been denied credit from Chase in the past 6 months.

Chase offers 3 different levels for cardholders. The Elite and Premium cardholders are offered 0% interest for the first six months, while standard account holders will be charged 22.24% (variable) from the first day.

After the first six months, Elite members are subject to 13.24% interest while Premium members will be charged 17.24%. (These rates are all variable, based on the Prime Rate and subject to change.)

Interest is computed on the average daily balance, including new purchases.

The APRs may increase if a cardholder defaults in any way. The new interest rate will be determined after considering the length of time the account has been open; the existence, seriousness and timing of defaults; and other indications of account usage. In addition, they will consider information gathered from other Chase accounts and from any of their related companies, or from credit reports.

Balance transfers and cash advances are charged at 3% of the amount, but not less than $10. International fees are also charged at 3%.

Chase will charge a late payment fee of $15 on balances up to $99; $29 on balances of $100 up to $249; and $39.00 on balances of $250.00 and over. The over-limit fee is $39.