Credit Card info/help/ammo needed

[rebelracewriter]

Ok, I need some help here(ammunition actually).....I recently bucked up and pulled some money to pay off my damn credit cards IN FULL....I was tired of them jacking up my rates and lowering my credit limit(even though I paid on time).....

 

So over the weekend I got both statements......They're still charging me interest(15.79 & 13.96)??? On what ZERO freaking balance??????.....Plus charging me for my credit shield(which I was led to believe was a % of my balance).....Again ZERO......WTF!!!!!

 

Can you ever get rid of these money hungry SOB's?

 

 

thanx.....

[racingmom]

You will have intrest the first month after you paid it in full (for the balance that had been on it before it was paid in full) There should be nothing on it the second month if that balance was paid in full.

[Ford27]

Do what i did to all these blood sucking leaches....called them up and told them to debit what was left and CLOSE MY ACCOUNT. i havent had a credit card in about 2 years and I will never ever ever have one again. Teaching my kids to pay as you go and not use credit. Now if I can get the goverment to do the same..lol

[gcavig]

Not a good idea to close the account because that will lower your credit score. If its paid and your balance is $0 just keep it open and dont use it very often. That will keep your credit score up and if you ever need a loan for anything you will get a better rate.

[Ford27]

It was a great idea to close the account....I already have a house so I dont need a loan...so far noone has turned me down when I offer cash.....loans are for people who want something they cant afford.

 

 

also on a quick edit most credit cards charge a fee now if you dont charge a minumum amount per year

[champkrt1]

Its a nice idea to eliminate them, but if you do a lot of traveling, they are vital for making hotel and rental car reservations...besides ordering racecar parts with no c.o.d. charges, etc etc etc.... just keep them paid down eneough that it keep your credit scores intact and fresh....just my .02 (that I didnt charge!)

[rebelracewriter]

Thanx....had two long phone conversations.......Long story short.....The squeeky wheel got the grease.....

 

They(both) tried to tell me it was interest on purchases made prior to 5/28/10......Ummmmm isn't this Novembe(11/15/10)???

 

My next issue.....If they know they're going to end up crediting your account anyway.....WHY piss of a 20 yr. customer and subject some poor CSR to the wrath of hell from said pissed off customer.....Doesn't make any sense to me...

 

I guess enough people don't take the time to call and give them hell so they collect a few extra bucks from them......

 

Funny thing one card offered me 0% interest on purchases until 12/31/11.....If they had been charging that in the first place I wouldn't have had to pay them off at 23-28%......Jackwads!!!!

[uhcougs]

Its a nice idea to eliminate them, but if you do a lot of traveling, they are vital for making hotel and rental car reservations...besides ordering racecar parts with no c.o.d. charges, etc etc etc.... just keep them paid down eneough that it keep your credit scores intact and fresh....just my .02 (that I didnt charge!)

 

You can do the same thing with debit cards. We're eliminating our credit cards. Haven't had any problems with airline reservations. I keep a very basic credit card open though to reserve the items, but pay with my debit card, if the trip may be canceled. Most rental companies and hotels will give you good discounts if you pay up front for your reservations as well. Living a debt free lifestyle is becoming a very relaxing way to live. It's like a cash discount really.

[Ford27]

Its a nice idea to eliminate them, but if you do a lot of traveling, they are vital for making hotel and rental car reservations...besides ordering racecar parts with no c.o.d. charges, etc etc etc.... just keep them paid down eneough that it keep your credit scores intact and fresh....just my .02 (that I didnt charge!)

 

 

I use my debit card for reservations for car rental hotels airfare and whatever else a credit card would be needed for...never had anyone say it wasnt good...

 

sorry uhgoughs...u already hit the nail on the head...yes very relaxing

[1-Crew]

Several points to consider here:

 

1. Absolutely right, the squeaky wheel gets the grease. Open every statement, question every charge, be nice but FIRM.

 

2. On credit cards you are trying to pay off. If they try to raise the interest on the remaining balance, simply call them and tell them you do not accept the change. It is a bi-lateral contract, they can try and change the terms but unless you agree, they can do nothing. You agree by:

A. Doing NOTHING (and letting the time limit to respond expire) or

B. Making a purchase.

If you call and say you do not agree they will tell you you have to close the account. If you are trying to pay them off, no big deal.. You don't need it anyway so close it. The remaining balance will be paid at the last accepted rate of interest.

 

3. When considering the "free or reduced interest" offers look carefully at the terms. If you think you can win by transferring the balance from a high rate card to a lower rate card, there is usually an up-front balance transfer fee (typically 3% of the balance). It can take a long time to recoup the initial transfer fee, especially if the lower interest rate only applies for a limited time. Also beware of the "monthly purchase" demon (Discover got me with that one once), the offer is for a reduced or zero interest but only if you make at least one $25 purchase each month at regular interest. The payment you make each month is applied to the transferred balance first, leaving the purchases to sit and accumulate interest. If you miss the one month deadline by a day, the entire balance reverts to the regular (exorbitant) interest rate.

 

4. On using Debit cards: the down side to using debit cards for travel is that, particularly with hotels, they will put a hold on the maximum funds to be charged for the duration of the stay. For example, if you use a debit card to hold a room, intending to pay with cash. If you stay for a week at ~ $100/night they will put a hold on the card for ~$1000. This is the room rate plus some extra to cover room service, damages or other services that you don't use. When you check out and pay the bill with cash, the debit card does not get credited back for the hold until a week or more after you have paid the bill. This can lead to unpleasant side affects when you try to pay other expenses with the debit card!

 

Entirely too late in life I discovered Dave Ramsey. Hope is not entirely lost but boy do I wish I had listened more to my mother when it comes to money..

[uhcougs]

4. On using Debit cards: the down side to using debit cards for travel is that, particularly with hotels, they will put a hold on the maximum funds to be charged for the duration of the stay. For example, if you use a debit card to hold a room, intending to pay with cash. If you stay for a week at ~ $100/night they will put a hold on the card for ~$1000. This is the room rate plus some extra to cover room service, damages or other services that you don't use. When you check out and pay the bill with cash, the debit card does not get credited back for the hold until a week or more after you have paid the bill. This can lead to unpleasant side affects when you try to pay other expenses with the debit card!

 

Entirely too late in life I discovered Dave Ramsey. Hope is not entirely lost but boy do I wish I had listened more to my mother when it comes to money..

 

My wife and I re-discovered him two months into our marriage and are on our way to the road of recovery LOL. Hotels is about the only thing I use a credit card (no fee card) for. But a lot of hotels are starting to offer discounted paid up front rates. Which is great if you KNOW your plans won't change. If they might, book normally and use that credit card. But I always pay with my debit card at check out.

[ShortTrackFan]

Lots of good stuff here, enjoy learning these things. Thank God for Dave Ramsey!

[jwmbishop]

It was a great idea to close the account....I already have a house so I dont need a loan...most credit cards charge a fee now if you dont charge a minumum amount per year

Not always a great idea, ESPECIALLY if you already have a house.

 

If you are paying more than 5.5% on your mortgage note, a refi at today's 4.1 avg would save you about 30% of your monthly payment per month - about 40% of the total interest over the life! (and just think if you could save 200 a month and put it in a "low" 9% yield IRA by the time you paid the house off you could have a retirement account that is even larger than the total inteset paid which means - you got paid to buy your home - something you were willing to pay for yourself - don't you like getting paid to do something you would have done for free or even more likely at your own expense anyway?)

 

To get to a 4.1 avg there are some higher and some lower - one could assume that there are 3.8's out there - and the only way to get those rates are with a high FICO - so it DOES pay to keep them cards open with a no or low balance - the hard part is the discipline to not use it (it like keeping pre-approval open at the lender(s)) - I paid mine off and cut em up - when they send the new ones I call in to activate and into the shredder they go. Even if you have your home free and clear there are ways to use credit (unused credit is a big tool) to your advantage.

 

When I insured our 57 with stated value they quoted me a rate, I cut a check and then two weeks later they declined coverage after they ran our FICO's - my score had dropped to 680 from 760 (because I paid off non carded lines of credit and closed them out early) - I was then quoted a rate (8.00 higher per 6 months than before) to restart a new policy. Regular auto insurance does not work this way - but they can still refuse to renew specialty policies if there is a sudden drop in FICO (indicates a financial hardship etc).

 

And yes you will see an interest charge on the statement following payoff - they charge interest on the balance until the date paid and that interest is on the next bill (they are not giving you anything when they say no interest on balances when paid in full - they merely have nothing to carry to the next bill if you pay in full on new charges).

 

If your card charges an annual fee for non use - just use it for a tank of gas once a year and pay it off (I think those are going away under the new laws though - it will be either yes or no to annuals regardless of activity - but again thats an "I think").

 

And loans are not just for people who can't pay cash. I just bought two offices in Arkansas and have the cash to write a check. However I took a note for the cost at 8%, my profit margin on the capital value of the offices is about 30% (I bought distressed business for 75 on the 100 - the bankruptcy option would have given him 30 on the 100 so everyones happy), on the daily reciepts about 15% - so basically someone else's money bought not just the asset but the income stream! And the cost of using someone elses money is deductable!

 

The typical homeowner is in much the same position. Lets say you want a new car - 0% for well qualified buyers means the one who left the account open! So you closed the account and your score is lower no big - with a line of credit secured by your home (available to even not so well qualified homeowners with more than 20% equity) you can pull cash from there, buy the car and the interest is now deductable as home mortgage interest! At least that way if you DO get stuck with a 6% or higher car note you recapture anywhere from 15-39% (depending on your bracket) of the interest paid as a tax savings!

 

Extra bonus question: Can your FICO affect your net worth?

 

YES - Your net worth is always whats left from asset value - obligations. Your gross value CAN be affected by FICO simply because fair market value is what a buyer and seller agree on with both sides being aware of all facts and circumstances. When valueing that home a higher score means less need for the seller to "get rid of it" - therefore less possibility of him coming off his price. Even if you are not intending to sell yet - when you do a finacial statement for your bank they only allow a valuation that includes possible (even if not probable) need for quick sale (quick sale - need forcing sale such a a death and tax issue or to stay out of forclosure etc - always reduce value). Generally speaking - if your home is worth 150K open market and 120K tax roles - the bank will not allow you to use the 150 as your Gross - unless you have BOTH a track record with their bank and a HIGH FICO!

 

But for me the bottom line is that if something were to come up that I needed money right now - emergency like cancer etc., business opportunity too good to pass up etc - it would SUCK to have to pass up an op or not get a good rate just because my score is low. It takes ONE transaction (like closing the account) to lower your FICO - but many (like six or seven months time) to raise it. Success is where oportunity meets readiness. Be ready - and be finacially sound when they converge!