Be Careful With 0 Balance Transfer Checks
Credit card issuers like to use different gimmicks to get you to transfer your debts to them. Sometimes they offer introductory rates, other times it could be rewards or incentives. Sometimes, they offer 0% balance transfers. Others, it could be a credit card check.
It is the credit card check that is probably the most dangerous incentive for you, as a potential new customer to a lender. There are many reasons for this, but the most obvious is that a check does not offer the same protections under the law that a typical credit card transfer does. Why is that?
Credit Cards and Checking.
The difference between a credit card and a check is not whether debt is involved, it is a matter who is the borrower and who is the lender. With a credit card, you are the borrower. You borrow the funds from the bank that issued the credit card (Mastercard and Visa are simply the payment processor) to pay a 3rd party. With a check, the bank repays the funds you lent to pay a 3rd party.
With a credit card, a debt is being created. With a check a debt is being transferred. When you make a credit card purchase, you create a debt with the credit card company. On the other hand, when you use a check, a bank transfers its debt to you to the bank (and ultimately the account) of the seller.
Mixing Two Incompatible Terms.
So, what is happening with a check ON a credit card account? It would seem to be a senseless combination of credit transactions. What happens when you sign the check and enter the amount can be confusing and is intended to be. This is one way the credit card companies hit you with interest charges, fees, and penalties. You lose many protections under the law when you use a credit card check that you may have assumed would be there. Instead of having the protections of checking and a credit card transaction, don't be surprised if you get less than either one!
Ask yourself this, what is the point of using a check with a credit card? Why would a credit card company send you a check to do a balance transfer? What rights are there when using a check with a credit card?
None of these answers will make you want to use a credit card check. You have to realize you are basically writing a check on an account for which you are creating DEBT! Since it is simply a credit card transaction, you are getting none of the advantages of checking with all the DIS-advantages of using a credit card.
Should You Avoid Them?
Not only is it a good idea not to use credit card checks. It is a better idea not to have a credit card with any bank that issues credit card checks. If you are getting them, it might be a good idea to find out if it is because of your credit score. Sometimes, issuers will do a credit inquiry to determine if your credit score will make you more likely to respond to these kinds of gimmicks.
Remember, you get the WORST of both worlds with credit card checks. Protection from your state attorney general, local courts, and consumer protection agencies may not be there if you use a credit card check in the way you expect for a typical credit card purchase or when writing a check. It may also be a good idea to track strange activities on your credit report if you do decide to use a credit card check.
Always keep this in mind. Credit card companies are not here to help you. You are simply another borrower to them. Your only chance is to be responsible with your credit cards, do not fall for their tricks, and to know your rights.
Talk to the Credit Card Companies
Just before the Congressional CARD act went into effect, I grabbed ahold of my credit card company and got them to make some changes before year end (back in December 2009).
My Credit Warning.
They were quietly increasing interest rates, at the time, on new purchases. They were also sticking it to me on PURCHASES I HAD ALREADY MADE! They did it to avoid getting snagged when the CARD act went into effect.
Well, I called them and argued with them and didn't give up!
I didn't care that my credit score got trainwrecked the past 16 months. My credit score had dropped around 120 pts. Some of it was because of THEIR behavior w/respect to cutting my credit limit on a current balance. For example, I had a $22K limit with a $7K balance. They dropped my limit to $7.5K which made it look like I was at my credit max and reported it to the credit reporting agencies!
This is why I always recommend staying on top of your credit scores and using a credit monitoring service. The way credit card companies operate, you have to stay on top of your information if you don't want to overpay on interest. Interest charges really add up over time!
Ask for the Manager.
If you don't get what you want, ask to speak to a Supervisor. Wait on hold for an hour, if necessary. Call back if they hang up. You can even mention you have a hardship. Tell them if they don't adjust the rate, you'll be forced to roll it all up into your impending bankruptcy filing.
Since I carry double digit balances on my cards due to business expenses and other incidentals, I figured this saved me over $3,000-4,000 in interest for a year! That's a nice home theater system, or a cheap car. See how those interest charges can really make a difference.
My Results.
AMEX Business Platinum - 19.24% (had a missed payment due to my oversight!) --> 9.24% FIXED!
First they refused - then I said, look at my payment history! Do you want to risk losing me to someone else who'll consolidate.
AMEX Gold - 12.24% --> 10.50% FIXED!
Discover - 15.92 --> 11.92% ADJUSTABLE (7.99% nominal + Prime)
They refused, then asked me if I wanted a special payment program where they'd drop the rate to 9.99% for one year, but suspend the card and report such to the credit reporting agencies.
No! Put me on the phone with a supervisor!
Visa - 12.99% --> 7.92% ADJUSTABLE (4.99% + Prime)
Discover - The Clever Card.
Credit cards were a rather good deal until all the financial geniuses got together and started adding little tweaks and ploys to CAPTURE PEOPLE and lock them into sky- high rates.
They started making credit a game of "Gotcha sucka!"
There were teaser rates that went away after a year and ballooned.
The cleverist was probably Discover.
They would give you 0% for the first 6-months and then 3.99% every month thereafter. The catch... You had to make at least two separate purchases greater than 99 cents with the card each month.
If you forgot to make 2 purchases, YOUR INTEREST RATE WOULD KICK UP TO 16% on any future purchases AND on any existing balance.
I had two things tagged to that card that auto-billed each month. Discover changed my payment date in a shorter month. When the charges didn't hit before the statement closed... BANG! My interest rate shot up 12%!!!!
Be Persistent.
Credit card companies depend on you not pushing for the lowest rates, not knowing your options, and being afraid to call them. Know your rights, know your credit score, and know your credit report. Call your creditors. And, don't be afraid!
Information is the name of the game in the world of credit. The credit card companies have a natural advantage. It is up to you to level the playing field so you don't waste years of your life paying interest, fees, and penalties instead of getting the things you want!
Capital One – Online Agreement – August 2009
ONLINE BANKING TERMS AND CONDITIONS (US-only)
Effective Date: August 2009
Thank you for choosing to use Capital One's Online Banking services ("Online Banking"). Before you use our Online Banking, you must review and agree to the following terms and conditions (the "Agreement").
Please note that Online Banking is currently only provided for the primary accountholder of U.S. consumer credit card and small business credit card and line of credit accounts.
UNDERSTANDING AND ACCEPTING THIS AGREEMENT
What This Agreement Covers
This Agreement governs your use of any information, content, products, services, transactions, and other features available on or through the Online Banking Web site ("Online Banking Site") now or in the future. It applies to any Online Banking access or use by you, whether you access the site through any Capital One URL addresses, electronic mail, links from another Web site, or any other means.
Other Agreements Governing Your Use
Any agreements, rules, or other terms governing any accounts that you may view, modify, or otherwise access while using Online Banking (such as your account agreement) will apply to your use of Online Banking. Your use of Online Banking is also governed by other rules, disclosures, disclaimers and other terms that we may post on the Online Banking Site, any other Capital One Site (defined below), or otherwise make available to you from time to time.
This includes any agreement, rules, or other terms governing the use certain features, products, or services available on or through Online Banking and the Terms and Conditions for capitalone.com. All of these agreements, disclosures, rules, and any other terms and conditions (collectively, "Additional Agreements") are considered part of this Agreement.
If the terms and conditions of this Agreement conflict with the terms and conditions in any Additional Agreement as they apply to online banking and online bill payment services, this Agreement controls. This Agreement is not intended to modify any disclosures or other terms required by law.
When using other services or features available through the Online Banking Site but provided directly by third parties such as rewards, your use will be governed by the agreements, program rules, or other terms or conditions governing use of those services or features.
Accepting this Agreement
By using or authorizing others to use Online Banking, you agree to the terms and conditions of this Agreement. Unless otherwise indicated, your use after any changes to Online Banking indicates you accept the Agreement in effect at the time. If you do not accept the Agreement, you may not use Online Banking.
WHAT WE MEAN WHEN WE SAY . . . .
"Capital One", "we", "us", or "our" mean, collectively, Capital One Financial Corporation, its subsidiaries and affiliates (including, but not limited to, Capital One Bank and Capital One, N.A.) and all of their respective successors, assigns, agents, and/or authorized representatives. However, with respect to a specific account(s), these terms mean the particular entity in the Capital One family of companies offering such account. Please consult your account agreement(s) for information about the Capital One company providing your individual account(s).
"You" or "your" mean each person (whether an individual and/or a business) who signed the application or other binding documentation for the account with Capital One (each, a "joint accountholder") accessible through Online Banking or through the Online Banking Site and to anyone else who is authorized to use the account in any way (each, an "Authorized User").
Whenever "you" is more than one person with respect to any account or relationship, the obligations and agreements applicable to you under this Agreement shall apply jointly and severally wherever appropriate.
"Business" means the corporation, company, partnership, association, or other business which employs an User (or with which an Authorized User is otherwise associated) and which has arranged for the issue of the Payment Card to Authorized User.
"Capital One Site" means any Web site owned or operated by a member of the Capital One family of companies that contains information about available products and services and/or terms and conditions relating to any accounts, account information, and/or transactions that you may view, perform, modify, or otherwise access or use while using Online Banking.
Capital One Sites shall include, but not limited to, the Online Banking Site, and capitalone.com.
"Payment Account" means the checking, savings, other deposit, or credit card account that you designate for payments made via Online Banking.
ENROLLMENT AND ELIGIBLE ACCOUNTS
Conditions for Enrollment
To enroll in and use Online Banking, you will need your Social Security or Tax Identification Number. If you do not have such a number and are interested in enrolling in Online Banking, you must notify us as specified on our Contact Us page.
You also must be the primary accountholder on at least one open account which is not restricted for fraud or national security reasons (such accounts may be referred to as "eligible accounts"). If you have requested that your account be closed but you still have a balance, or your account is in collections, under suspicion of fraud, or has any other reason for restricted status, you may still have access to Online Banking, but you may not be able to perform certain functions on your account such as request a balance transfer.
By enrolling to use Online Banking, you certify that you:
- (a) are 18 or older;
- (b) are a United States resident;
- (c) are legally capable of entering into contracts, and
- (d) have and will only register Payment Account(s) in your name or the name of a business on which you are an account holder or Authorized User.
You agree that some or all of the registration information you provide may be subject to verification by Capital One at any time.
If enrolling to use Online Banking for a Business, you also represent and warrant that:
- (1) you have authority to enter into this Agreement on behalf of the Business and yourself;
- (2) you have authority to provide all required or requested authorizations to us on behalf of both yourself and the Business; and
- (3) you will use the Payment Account(s) consistent with your obligations to and agreements with Business.
Linking Your Capital One Credit Card Account(s) and Certain Other Accounts
Once enrolled, you will need to choose the accounts you would like to have Online Banking access to from the list of eligible accounts we provide.
Closed or charged off accounts are not eligible. Accounts currently under suspicion of fraud are also not eligible until the fraud alert is removed or otherwise resolved.
Capital One credit cards currently accessed under different user names may be linked. Linking such a credit card account to your Online Banking profile allows you to service the account from the same user name but does not merge the accounts in any way.
You can consolidate any accounts currently serviced under a different user name to a single user name. If you choose to do so, pending payments and the payment account you have set up will be moved to the new user name; however, secured message inboxes from the old user name(s) will not move.
Non-linked account(s) will not be accessible through Online Banking. Accounts which are in restricted status for reasons such as fraud, national security, or collections may not be able to be accessed through Online Banking for some or all activities such as viewing account information, or conducting payments or other transactions.
To get any information or conduct any activity on any other accounts you may have with Capital One such as deposits, or loans with Capital One, N.A., you must access the online banking site(s) for those products and services, accessible through capitalone.com.
AUTHORITY YOU GRANT CAPITAL ONE AND ITS SERVICE PROVIDERS
By enrolling in Online Banking, you authorize Capital One and its service providers to process instructions and to post transactions to your account(s) as directed by you from time to time.
Capital One's receipt of your bill payment instructions authorizes us or our service providers to debit or charge (or if the Payment Account is with another financial institution, request that such institution debit) your Payment Account, and to remit (or request that such financial institution remit) funds on your behalf.
SECURITY AND YOUR ACCESS INFORMATION
Use of Online Banking requires a computer and Internet access connected through an Internet Service Provider with a Web browser (for example, Netscape Navigator or Microsoft Internet Explorer). We recommend you enroll using the computer you will use as your primary connection to Online Banking.
We require you to protect your financial information by using the most secure encryption possible. Use of browsers that provide encryption using a 128-bit key is therefore required. The higher the level of encryption, the harder it is for unauthorized persons to read information.
If you do not have this level of encryption, many browser suppliers offer special 128-bit encryption versions of browsers (e.g., the Netscape Navigator browser and Microsoft Explorer browser), available for download from their Web sites. If you use lower than 128-bit encryption, you may be unable to enroll in or use Online Banking. We are not responsible for any losses resulting from your use of lower than 128-bit encryption.
To prevent unauthorized access to your account(s) and use of Online Banking, you agree to keep your user name, password, challenge questions, and any other security or access information (collectively, "Access Information") confidential.
We recommend that you memorize your Access Information and do not write it down. You agree not to give or otherwise make available your Access Information to any unauthorized individual.
If you believe the security of your password or any other Access Information has been compromised in any way (for example, your password has been lost or stolen, someone has attempted to use Online Banking under your user name without your consent, or your account has been accessed), you must notify us IMMEDIATELY as specified on our Contact Us page.
Under certain circumstances, we may deny your access to any one or more account(s) or to Online Banking or any part thereof, or the processing of transactions, in order to maintain or restore security or performance to the Online Banking Site or any other Capital One Sites and systems. We may do so if we reasonably believe your Access Information has been or may be obtained or is being or may be used by an unauthorized person(s). We may try to notify you in advance, but cannot guarantee we will do so.
HOW WE WILL COMMUNICATE WITH EACH OTHER
You agree to receive in electronic form this Agreement, any updates to this Agreement, and all disclosures, notices, and any other communications regarding Online Banking and your Online Banking transactions. You may withdraw your consent to receive all these communications electronically only if you cancel your enrollment in Online Banking by notifying us as specified on our Contact Us page.
You agree that all electronic communications that we receive on the Online Banking Site or otherwise connected to Online Banking, such as those directing us to take an action with respect to your account, that match Access Information or other identity information you have provided when enrolling in or using Online Banking will be deemed valid, authentic, and binding obligations.
These communications will be given the same legal effect as your written and signed paper communications, shall be considered a "writing" or "in writing", and shall be deemed for all purposes...
- (i) to have been "signed" and
- (ii) to constitute an "original" when printed from electronic files or records established and maintained in the normal course of business.
You agree that electronic copies of communications are valid and you will not contest the validity or enforceability of such communications or any related transactions, absent proof of altered data or tampering.
You also agree such copies shall be admissible as evidence in any judicial, arbitration, mediation, or administrative proceeding to the same extent and under the same conditions as other business records originated and maintained in paper form.
E-mail and Secure Messages; General Communications
You agree to receive all transactional e-mail communications from Capital One that are primarily related to your use of Online Banking or to your account(s), including automatic security alerts (discussed below). You consent to any inadvertent disclosures which may occur as a result of Capital One sending account communications to the e-mail address you provide.
Because e-mail is not a secure method of communication over the Internet, we recommend you do NOT use e-mail to send confidential or personal information or initiate transactions on your account(s). We also recommend that you do not send confidential or personal information to us in text messages.
We will not respond to or act upon text messages received from you, unless in connection with a specific program or instructions provided to you.
We recommend that for account transactions or confidential questions you use the appropriate functions available through Online Banking or notify us as specified on our Contact Us page. All other communications should be sent via secure messaging, available through the "Messages" section of the Online Banking Site.
Security Alerts and Optional Communications (including Text Messages)
Online Banking may offer both automatic security alerts and optional alerts and communications about your account and account transactions. Security alerts are sent automatically for fraud protection reasons when certain important changes to your account occur, such as password and user name updates, or changes in your physical or primary e-mail address - they are sent to your primary e-mail address or other contact point if available and requested.
These alerts are part of the Online Banking service and are not optional. In addition to security alerts, you may have the option to choose to receive additional alerts or communications regarding other Online Banking and account activity, delivered by e-mail, text message or voice (together, "Optional Communications").
You may be asked to select from contact options when you sign up for the Optional Communications. By signing up to receive any Optional Communications, you consent to delivery of such messages in the format selected (such as text message or prerecorded voice) to the contact points you identify.
Both security alerts and Optional Communications are subject to the following:
You are responsible for notifying us of any changes to your e-mail, mobile device, and telephone contacts to which communications are sent. To modify or cancel your Optional Communications, log into Online Banking and change your selections at the appropriate area of the Website.
For help with text messages, you may text "HELP" to U.S. and Canada short code 227663. If you text "STOP" to short code 227663 from your mobile device, the command will revoke your consent to receive any alerts and other Online Banking-related text messages at that mobile device from such short code (although we may send a confirmation of your opt-out), but will not revoke any other consent you may have provided us.
If you provide us your mobile device number for security and/or Optional Communications, you expressly agree to receive prerecorded messages and/or text messages at that number from us and our authorized agents, including with the use of an automatic dialer (autodialer).
Your full account number will not be included in any communication from us. However, communications may contain our name and information about your accounts. Depending upon the communication, information pertaining to account balance, transactions or payment due dates may be included.
Anyone with access to your e-mail, mobile device(s), or telephone or telephone answering machine(s) or service(s) may be able to access the contents of the communication. It is your responsibility to secure these devices, protect your user name(s) and password(s), and provide timely information about contact changes in order to protect the confidentiality of this information.
You consent to any disclosures by Capital One that may occur if you do not take appropriate steps to prevent access to your information by unauthorized persons.
We endeavor to provide communications in a timely manner with accurate information. However, we do not guarantee the delivery or accuracy of the contents of any communication. Communications may not reflect pending transactions or payments and may not be delivered immediately.
Delivery of text messages depends on, among other requirements, signal and service availability. If you require additional details about a transaction, you may log in to Online Banking or contact us as specified on our Contact Us page.
You agree that we shall not be liable for any delays, failure to deliver, or misdirected delivery of any communication; for any errors in the content of a communication; or for any actions taken or not taken by you or any third party in reliance on a communication.
Statement of Record
If you receive paper and electronic statements, any account information provided by Online Banking is not the statement of record. The periodic statement that is mailed to you will be the statement of record. If you have chosen to stop receiving paper statements, the periodic statement provided to you electronically will be the statement of record.
In any case, you are responsible for reviewing any statement and other account communications sent to you by postal mail. Any mailed statement and other account communications will continue to contain important information about your account(s), regardless of whether you access your account(s) through Online Banking or have chosen to receive your statement electronically.
PAYMENTS
Payments to certain Capital One credit card account(s) from any checking, savings or other deposit account(s) you designate for payment may be made via the Pay Capital One feature of Online Banking. Pay Capital One payments through Online Banking will be debited from your designated Payment Account, which may or may not be a Capital One account.
When you designate a Payment Account, you warrant that you are an authorized signer on the Payment Account. Pay Capital One payments through Online Banking will be debited from your designated Payment Account. Capital One's receipt of your bill payment instructions authorizes us to debit (or if the Payment Account is with another financial institution, request that such institution debit) your Payment Account, and to remit (or request that such financial institution remit) funds on your behalf.
Make Instructions and Changes with Time to Spare
You understand and agree that to be processed in accordance with your instructions, payments instructions and any changes to these instructions through Online Banking must comply with the payment rules disclosed when you make a payment. These payment rules are considered part of this Agreement.
Our Responsibilities for Payments
We, or a third party acting as our agent, will use reasonable efforts to complete payments from your Payment Account(s) according to your instructions. However, neither our service providers nor we will be liable in any way (including, but not limited to, payment processing errors or fees):
- If, through no fault of our own or of our agent, you do not have enough available funds or credit in your account to complete a transaction, or if your Payment Account has been closed;
- If Online Banking is not working properly and you knew or were told about the malfunction before you started the transaction;
- If you have not properly followed instructions on how to make a payment;
- If you do not provide Capital One with complete, correct, and current Payment Account information, contact information, or if you otherwise do not give complete, correct, and current instructions;
- If you do not authorize a bill payment in time for your payment to be made and credited by the due date;
- If withdrawals from your account have been prohibited by a court order such as a garnishment or other legal process;
- If we or our agent reasonably believe that a transaction may be unauthorized;
- If your computer, computer system, or any related equipment and software was not working properly;
- If circumstances beyond our or our agent's control prevent making a bill payment including, but not limited to, computer failure, telecommunication outages, postal strikes and other labor unrest, delays caused by payees, fires, floods, and other natural disasters, terrorist acts or war; and
- In any other set of circumstances as set forth in any Additional Agreements.
If You Close Your Payment Account or Capital One Credit Card
If you close your Payment Account with Capital One or any other institution, any payments scheduled to be deducted from that Payment Account will not be processed. If you do not make alternative arrangements, you will be solely responsible for any fees incurred for late or non-payment as a result. If you close any Capital One credit cards for which you have set up payments, please cancel your payments with the institution holding the Payment Account.
YOUR RESPONSIBILITIES AND LIABILITIES
Update, Protect, and Monitor Your Contact and Other Information
It is your sole responsibility to ensure that your contact, Payment Account, and other information is current and accurate. This contact information includes, but is not limited to, name, address, phone numbers, e-mail addresses, Payment Account numbers, and any other information about your Payment Accounts(s).
Changes to contact information can be through the Online Banking Site or notifying us as specified on our Contact Us page. Failure to provide accurate and complete information (including misrepresenting your identity or other information) may result in errors in your requested payments or be a basis for our prohibiting your use of Online Banking in the future.
To prevent unauthorized access to your account(s) and use of Online Banking and your Payment Account(s), you agree to keep your user name, password, challenge questions, and any other security or access information (collectively, "Access Information") confidential. We recommend that you memorize your Access Information and do not write it down. You agree not to give or otherwise make available your Access Information to any unauthorized individual.
You will receive periodic statements for your account(s) with the regularity provided for in your account agreement(s). To help prevent any wrongful use of or errors on your account(s), you must carefully examine your statement upon receipt.
Unauthorized Transactions
Notify us IMMEDIATELY if you suspect that an unauthorized transaction has been or may be conducted from your account(s), another person has improperly obtained your online password(s), or fraudulent activity has occurred on your account(s) by notifying us as specified on our Contact Us page. You agree to assist us in our efforts to recover any funds that were transferred or paid without your permission. For more information on your rights and responsibilities for unauthorized transactions, please review your account agreement.
Errors or Questions About Payments or Other Online Banking Transactions
In case of questions or errors about payments or other transactions made through Online Banking, you must call us as specified on our Contact Us page. For more information on your rights and responsibilities for billing errors, please review your Billing Rights Summary which is considered part of this Agreement.
DISCLOSURE OF ACCOUNT INFORMATION TO THIRD PARTIES
You authorize us to disclose to third parties, affiliates, and agents, such as independent auditors, consultants or attorneys, information you have provided or that we or our affiliates have obtained about your accounts and the transfers you make on Online Banking for the following reasons:
- To comply with laws, government agency or court rules or orders, subpoenas, or other legal process or to give information to any government agency or official having legal authority to request such information;
- To verify your account's existence and condition for a third party, such as a credit bureau or merchant;
- When necessary to complete any type of bill payments;
- To provide services relating to your account or to offer other products and services; or
- If you provide us your permission.
For more information about how we may use, share, and safeguard the information that we collect from you in connection with Online Banking, and your options regarding our use and sharing of such information, please view the privacy and security areas of our Online Banking Site.
FEES AND CHARGES
We do not at this time charge any fees for your use of Online Banking, including viewing your account information and making bill payments. However, we reserve the right to charge a fee, in an amount to be determined by us, for your use of Online Banking at any time.
Depending on your account(s) and how you access Online Banking, you may incur charges for:
- Any fees, charges, penalties, balance requirements, and other restrictions explained in your account agreements or other Additional Agreements;
- Certain services which can be requested through Online Banking such as ordering a paper copy of a statement; and
- Telephone charges and/or Internet service fees resulting from your access to Online Banking.
SERVICE HOURS, INTERRUPTIONS IN SERVICE, AND CHANGES
Service Hours and Interruptions in Service
Online Banking is generally available for your use 7 days a week, 24 hours a day. However, from time to time, we may perform maintenance upon or experience hardware, software or other problems related to Online Banking, resulting in interrupted service, delays, or errors. We may try to notify you in advance, but cannot guarantee we will do so.
Changes
To continue to provide you with this valuable service, we may revise, update, discontinue, or otherwise modify, temporarily or permanently, part or all of Online Banking (including, but not limited to, the Online Banking Site, this Agreement, the services or features offered, and any materials related to Online Banking), or your access thereto, at any time. We will attempt to notify you in advance of any material changes, but cannot guarantee we will do so. Notice may be provided via a number of methods(to be chosen by us), including messages at log in, secure message, or messages sent to postal or e-mail addresses in our records.
You may choose to accept or decline changes by closing, continuing, or discontinuing use of Online Banking to which these changes relate. Your use of Online Banking after we make any changes will constitute your agreement to such changes.
TERMINATION
You may continue to access Online Banking until your access is terminated by you or Capital One. You may cancel Online Banking at any time by calling us as specified on our Contact Us page. If you close all active accounts you access through Online Banking, you may no longer be able to access Online Banking.
Cancellation of your access to Online Banking will not terminate any accounts you access via Online Banking or any transactions currently pending or scheduled through Online Banking. To cancel payments scheduled through Online Banking, you will need to cancel all payments before cancelling your access to Online Banking. If you do not do so, you will need to call us.
We may terminate your access to Online Banking, in whole or in part, at any time and for any reason, including security reasons. We may try to notify you in advance, but cannot guarantee we will do so.
ASSIGNMENT
You may not assign this Agreement or your rights to use or access Online Banking to any other party. We may assign this Agreement to our parent corporation, any existing or future direct or indirect subsidiary of our parent corporation or another Capital One entity, or to any existing or future affiliates. We may also assign or delegate certain of our rights and responsibilities under this Agreement to independent contractors or other third parties.
DATA RECORDING
When you contact us, the communication or the information you provide may be recorded or otherwise retained by us or our service provider. You consent to such recording or other retention. Without limiting the above, you agree that we may record the conversations our employees or agents have with you or your agents to ensure your instructions are followed and monitor quality of service and accuracy.
NO WAIVER
We shall not be deemed to have waived any of our rights or remedies hereunder unless such waiver is in writing and signed by us. No delay or omission on our part in exercising any right or remedy shall operate as a waiver of that right or remedy or any other rights or remedies. A waiver on any particular occasion shall not be construed as a bar or waiver of any rights or remedies on future occasions.
LIMITATIONS OF LIABILITY AND DISCLAIMERS
While we strive to deliver a valuable and error-free service whenever possible, your use of Online Banking is at your own risk. Capital One, nor any of its officers, directors, or employees, nor any other party involved in creating, producing, or delivering Online Banking is liable for any direct, incidental, consequential, indirect, punitive, or other damages of any kind arising out of your access to or use of Online Banking, or the inability to access or use Online Banking, regardless of cause. Without limiting the above, you agree you are solely liable for and will indemnify Capital One where appropriate for...
- Any and all claims, losses, liability, damages, and/or demands (including, but not limited to, reasonable attorneys' fees and court costs) arising out of or in any way connected to our honoring or following any and all electronic communications for which we have attempted to verify your identity as set forth above;
- Any error or loss of data, information, transactions, or other losses which may be due to the failure of your computer, computer system, any related equipment and software, or third party communications providers on which you may rely; and
- Any viruses, worms, Trojan horses, or other similar harmful components that may enter your computer, computer system, and any related equipment and software by downloading information, software, or other materials from the Online Banking Site or any other Capital One Site.
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New Credit Card Act, Balance Transfers & Loopholes
Highlights
- A rate increase can ONLY be applied to an existing balance IF the cardholder is delinquent.
- If your credit card gets a rate increase on NEW balances, you must be notified 45 days in advance.
- Those under 21 can't apply for a credit card unless they have a co-signer, income, or pass a course.
So, expect credit card companies to find new ways to declare you delinquent.
This puts no limit on the amount of the increase, does not require the credit card company to get your agreement to the increase, and places no restriction on the reason for the increase.
This effectively removes one of the most profitable segments from the credit card companies. To make up for these lost customers, expect higher interest rates, higher up-front fees, and more restrictive terms.
Credit CARD Act.
On May 22, 2009, the Credit Card Accountability, Responsibility and Disclosure, or Credit CARD, Act was signed into law by President Barack Obama. This act changes how credit card companies make disclosures to their customers and ends a few of the more egregious practices prevalent in the credit card industry.
Major Changes.
Recent years have seen very arbitary, punitive, and deceptive practices engaged by many credit card issuers. Whether it was interest rates, fees, balance transfers, low introductory rates, changing payment dates and balances, or aggressive collection practices, people were being subject to many activities that made having a credit card quite an adventure!
To combat this, Congress decided to reign in some of these business practices. While customer complaints were mounting, that was not the motivation behind this new legislation. Rather, it was the financial distress of 2008 that motivated these restrictions on credit card activities.
Quite simply, the very groups that offered the greatest profit potential for credit card companies (the young and the working poor) could no longer afford to keep their credit cards. Those who had ample credit and means other than borrowing, were using credit offers to cut credit card companies profits to almost nothing. With this squeeze, Congress had to do something.
Protecting the Public.
To give the credit card companies and other lenders, a chance to regain their footing with borrowers, new regulations were created to provide a more stable and sustainable credit environment. Let's examine these changes.
Retroactive rate increases are STOPPED! (not really)
Generally, under this new act, lenders can no longer raise interest rates on existing balances. However, this is not true in every case. If your contract specifically spells out that the rate can be changed, on an existing balance, you still are liable to pay the higher rate.
3 specific instances can occur to raise your rate on an existing balance, despite the Credit CARD Act.
- You have a promotional rate offer that expires, such as a balance transfer.
- You have a variable rate card that is indexed to the prime rate and it has increased.
- You are delinquent on payments for 60 days or more.
Higher Interest Due To Other Cards.
In theory, credit cards are prevented from raising interest rates for late payments on unrelated accounts under the pretense of universal default or "anytime, any reason" clauses. Then again, there is nothing preventing a credit card company from changing its contract terms to reflect their opinion of new credit realities (just an excuse to raise your rate while circumventing the Credit CARD Act).
Delinquent Payments.
If a credit card company classifies a card holder as 60-day delinquent, the bank must restore the lower rate after 6 months of consecutive on-time payments. Of course, the challenge here is that the lender decides when payments are due. There is nothing to prevent them from making it very difficult to meet this standard. They can change due dates, vary when monthly bills are sent, add fees for certain payment types, or just refuse payment in specific cases (don't accept wire transfers, refuse payment from other credit sources, etc.). The Credit Card ACT doesn't addres any of these possibilities.
Generally, in the first year after issuance, interest rates cannot go higher. Promotional rates must last a minimum of 6 months. This does not include...
- promotional rates,
- the ending or completion of a workout plan,
- a change in the index rate used to establish an interest rate, or
- a 60-day delinquency.
In other words, the only interest rate increase the Credit CARD Act covers are those not covered in the contract. It does not prevent a credit card company from raising rates if it is covered in the contract or agreement.
In fact, as long as they claim you were given 45 days notice, lenders can raise your interest rate at any time and for any reason on any NEW balance.
Credit Limit Changes.
There are no provisions in the Credit CARD Act that limits any action by a credit card company from changing your credit lines. If your credit card company slashes your credit limit, cancels your card, or reduces your limit JUST ABOVE your existing balance, they have no obligation to notify you.
The only time a credit card company must tell you when a credit limit has changed, is if it triggers a penalty. For example, if a credit card reduces your credit line below your existing balance AND that triggers an overlimit fee, you must be notified first.
Always remember, no credit act, credit right, or credit protection places any limit on the maximum amoung you can be charged in interest. For instance, an increased rate could triple your existing APR. You have no recourse under the law.
Fee restrictions.
The Credit CARD Act applies to more than just credit cards. It includes debit cards as well. Cardholders, whether debit or credit, are no longer subject to overlimit fees without their approval. Card issuers are allowed 1 overlimit fee per billing cycle.
Paying to Pay?
Banks can no longer charge you for paying a credit card debt. This practice occured with telephone or Internet payments. The only fee that can be charged is to expedite a payment. So, expect to see telephone and internet payments recategorized as express payment options, while regular payments experience constant busy signals or wait times and very confusing or burdensome website payment systems.
Due Date.
Payments received on the due date (or the next business day) if the bank doesn't process a mailed payment on the due date, do not trigger a late fee. If paying at a local branch, the payment must be credited THAT day.
This does not end the practice of changing billing cycles or changing billing statement mailings. You are still liable for fees in both cases. You have no protection if your billing cycle was 28 days this month, rather than 31. It is entirely your responsibility.
Sub-Prime Credit Cards.
The Credit CARD Act does not eliminate "fee-harvester" subprime cards. It does change the way the fees are charged. After issuance, in the first year , non-penalty fees cannot be more than 25 percent of the initial credit limit. Of course, this does not address the limit on fees if the credit limit is reduced. In that case, you still have to pay the fees, despite exceeding 25 percent in that situation.
Restricting Credit Access to the Young.
For those under 21, without an independent source of income or a co-signer 21 or older, they cannot get a credit card.
Ultimately, this may only push them to payday lenders and pawnshops.
Double-cycle billing.
The outrageous practice of double-cycle billing is basing finance charges on the current and previous balance. Essentially, an issuer could charge double on the same borrowed amount!
This was ended because it gave an incredible advantage to lenders who depended on the poor, young, and desperate for loans. More established creditors with higher standards could not compete for these customers, leaving them out of this profitable market.
The Credit CARD Act is inteneded to end this practice and restore more balance among the credit card issuers.
Paying Your Payments.
Before the Credit CARD Act, a lender applied payments to the chrages with the LOWEST interest rate, first! Well, after the Credit CARD Act that still happens. The only change is when you make an above-the-minimum payment. That MUST be applied to the credit balance with the highest interest rate.
Your Bill Is In The Mail.
Creditors must send payment notices with 21 days' notice. Of course, this creates the problem of the changing expectations of when a balance is due.
For example, a credit card issuer could send all statements out with 3 weeks until the due date. Once people get used to it, they establish a routine of paying their bills with 21 days in mind. If the credit card issuer then changes it to 14 days, the previous routine is disrupted, which will result in a lot of late payments.
That could trigger late payment fees, higher interest rates, reduced credit scores, and lower credit limits.
Gift card programs.
The Credit CARD Act covers gift cards. They must last at least five years. Issuers are stopped from applying inactivity fees. The exception is for cards that have been unused for 12 months. That exception makes you wonder why have the law at all?
Are You Protected?
While there are a number of changes in the new law from previous practice, it is not much protection from deceptive, misleading, or excessive fees, terms, and interest rates. You just have to accept that access to credit will be much more restrictive than it has been.
Your best bet is to stay on top of your credit profile. Know what is in your credit report. Know your credit scores. These are probably the two most important things in your financial life.
Get your FICO score. Be ready to write dispute and goodwill letters. Monitor your credit reports. Be aware who your attorney general is for your state.
Going forward, you need to be aware of your rights, protections, and remedies for dealing with lenders and credit card issuers. It is your responsibility. Give yourself a chance with your creditors.
How Do Banks Use ChexSystems
ChexSystems.
Suppose you are reported to chexsystems. You apply for a bank account which uses telecheck or credit reports to verify your application information. If you are deemed a credit risk, they may deny you a bank account!
Some banks use a credit report ONLY for identification purposes. Others use it to look at your credit score and credit lines.
Chexsystems does not decide whether you get a bank account. That is 100% the decision of the bank.
The Appeal of ChexSystems.
The vast majority of banks use chexsystems. Many banks offer 2nd-chance checking (under various names) for those reported to chexsystems. For those banks that do not offer 2nd-chance checking, they may make an exception and allow you to open an account, anyway. Many banks make exceptions today.
The problem with 2nd-chence checking and the exceptions they make is no formal guidelines exist to determine if a person gets a bank account.
Let's say...
BANK A
----------
CUSTOMER 1
- CHEXSYSTEMS REPORT IS PAID AND NO DEBT
- CHEXSYSTEMS REPORT INDICATES NO SUFFICIENT FUNDS (NSF)
- CHEXSYSTEMS REPORT SHOWS 2 BANKS REPORTED
*** CUSTOMER IS DENIED***
CUSTOMER 2
- CHEXSYSTEMS REPORT IS PAID AND SHOWS NO DEBT
- CHEXSYSTEMS REPORT INDICATES ACCOUNT ABUSE
- CHEXSYSTEMS REPORT SHOWS 1 REPORTING BANK
*** CUSTOMER IS DENIED***
CUMSTOMER 3
- CHEXSYSTEMS REPORT SHOWS CUSTOMER HAS NO DEBT INFO AVAILABLE
- CHEXSYSTEMS REPORT SHOWS NO SUFFICIENT FUNDS (NSF)
- CHEXSYSTEMS REPORT SHOWS 1 BANK REPORTING
*** CUSTOMER IS APPROVED ***
CUSTOMER4
- CHEXSYSTEMS REPORT SHOWS SMALL BALANCE OF 50.00 OWED
- CHEXSYSTEMS REPORT SHOWS NOT SUFFICIENT FUNDS (NSF)
- CHEXSYSTEMS REPORT SHOWS 1 BANK REPORTING
**CUSTOMER IS APPROVED ***
----------------------------------------
BANK B
CUMSTOMER1
- CHEXSYSTEMS REPORT SHOWS CUSTOMER OWES 1200.00
- CHEXSYSTEMS REPORT SHOWS NSF
- CHEXSYSTEMS REPORT SHOWS 1 REPORTING BANK
***CUMSTOMER IS APPROVED***
CUSTOMER2
- CHEXSYSTEMS REPORT SHOWS CUSTOMER HAS NO DEBT INFO AVAILABLE
- CHEXSYSTEMS REPORT SHOWS SUSPECTED FRAUD
- CHEXSYSTEMS REPORT SHOWS 1 REPORTING BANK
*** CUSTOMER IS DENIED***
CUMSTOMER3
- CHEXSYSTEMS REPORT SHOWS CUSTOMER OWES 20.00
- CHEXSYSTEMS REPORT SHOWS FRAUD
- CHEXSYSTEMS REPORT SHOWS 1 REPORTING BANK
***CUMSTOMER IS DENIED***
--------------------------------------------------
BANK C
CUMSTOMER1
- CHEXSYSTEMS REPORT SHOWS CUSTOMER OWES 400.00
- CHEXSYSTEMS REPORT SHOWS NSF
- CHEXSYSTEMS REPORT SHOWS ONE REPORTING BANK
- CHEXSYSTEMS REPORT IS 3 YEARS OLD
*** CUSMTOMER IS APPROVED ***
CUSTOMER2
- CHEXSYSTEMS REPORT SHOWS CUSTOMER OWES NO DEBT
- CHEXSYSTEMS REPORT SHOWS NSF
- CHEXSYSTEMS REPORT SHOWS ONE REPORTING BANK
- CHEXSYSTEMS REPORT IS ONLY 1 YEAR OLD
*** CUSTOMER IS DENIED****
Basically, it really depends on each bank. Most will not have a set guideline, if you contact them about making exceptions. As I said earlier, chexsystems does not determine if a cumstomer is denied or approved. It is only a tool the bank uses for account decisions.
Exceptions.
Some have told me they were denied at one bank branch but approved at another. Each manager and each bank makes exceptions on their own terms and will make them differently when you have been reported to chexsystems.
Know what is in your chexsystems report. It is very important because it could affect your ability to open a bank account. Just because a bank may make an exception for you may not work if your chexsystems reports is considered a "toxic" one.
Items Used In 2nd Chance Banking.
How old is the report?
How many banks have reported you?
Does your report show debt owed, no debt owed, or no debt information reported?
Does your report indicate insufficient funds (NSF), account abuse, suspected fraud, or fraud?
These factors affect whether you get approved for a bank account.
Cautions.
Be careful when applying for an account at banks that you are certain will not open an account. Your chexsystems account could be flagged. This would ruin your chances to get an account at a bank that may have given you one, otherwise.
Recommendation.
Personally, never use banks that rely on chexsystems. If policy changes regarding the bank's use of chexsystems, your account may be closed. A bank is sold and new policies are made, the account is closed. Managers come and go, and accounts is closed. Over the years, there have been horror stories of people being hurt when their bank account, in good standing, was frozen and closed.
This is not to say chexsystems is all bad. Some prefer it for convenience and others just prefer the big banks. This is why I suggest having a backup account. Never have all your deposits in one place.
Creditor Tricks Or How They Get You
With the overflow of credit that ended in 2008, the banks, credit card issuers, finance companies, and mortgage originators have been reducing credit steadily. They are decreasing the number of loans they offer, charging higher interest rates, and all the while asking for government help.
It is not a good time to be a borrower, especially not for long-term debt. You may be thinking it may be better to wait this out until things get better. Unfortunately, now may be as good as it gets for a LOOONNGGGG TIME!
To cope with what may be years of tight profit margins, fewer customers, and less opportunity to grow, many lenders are developing many new tricks to get you to pay more than you expect for credit. Let's identify some of the ones we see today.
The Unexpected Interest Rate Hike.
Interest rates have increased steadily for the past 5 years. Today, they are higher than ever. Despite near 0% interest rates the banks pay for credit, they are charging their customers double-digit interest rates. It is a great deal for lenders.
Some credit card companies have increased interest rates to as much as 36%! In this case, you wonder why the state attorney general refuses to enforce usury laws. Believe it or not, according to Federal law, there is basically no protection for anyone from excessively high interest rates. Why? The principle is that if one state allows high-interest rates, effectively all do.
This happens because a credit card or any finance company can operate as a national corporation rather than a state one. As a national corporation, it is subject to Federal law rather than state law. Thus, it can ignore state laws that are more restrictive than Federal ones. Your attorney general is powerless to pursue and prosecute.
Fees Fees Fees.
Fees are more than rising, they’re multiplying. Borrowers are getting hit with fees for everything under the sun. To add to the insult, new laws only cover existing fees and business practices. They do not limit any NEW fees lenders introduce.
Borrowers are seeing new annual fees, inactivity AND activity charges, and more. While these fees are not entirely new, they haven't been seen in years. Many didn't see them during the days of easy credit from 2004-2007. So, to see them appear when credit is tightening is not a good sign of things to come.
Higher Minimum Monthly Payments.
There was a time when lenders would accept very small monthly payments to maintain your credit. To add to that, you could always find an additional credit line, equity line of credit, or balance transfer card to service your debt if cash were tight. Those days are long gone.
Banks are demanding bigger and bigger minimum monthly payments. While an increase from 2% to 5% may not sound big, look at the numbers. If a minimum payment was $200 a month, that has increased to $500! In an environment where getting a loan is harder, the increase is enough to potentially wipe out a person's ability to pay their bills.
Disappearing Rewards.
Are you used to a beach vacation, cashback on purchases, or a new iPod just for swiping your card? Well, that is another relic of a easy credit era that is slowly, but surely disappearing.
Reduced Credit Line Or Cancelled Account.
If none of the above have stopped you from borrowing, there are a few final things lenders are doing to reduce your access to credit.
Without even a call from the bank, some borrowers are learning their credit limits have been cut by as much as 75%. Or, their accounts have simply been closed. What's humiliating, is when you try to make a purchase and you've been denied. Welcome to the new credit reality!
What Can You Do?
Your best best is to read your loan contract. However, with so much confusing language and terms that change, it can be daunting. Another approach is to make sure your credit file, reports, and scores are in the best shape possible.
The more you are on top of your credit, the more likely creditors will give you the best terms and rates. They know you are diligent and responsible and are willing to assert your rights when necessary.
Some good resources to try (these are not free, mind you) are...
MyFICO Credit Scores,
Equifax Credit Watch, and
Bureau Watch.
The credit landscape has changed for good. The days of 0% introductory rates, home equity lines of credit, and free-wheeling rewards programs are done. Now, you need every resource at your disposal to compete and get the best credit available for your circumstances.
Tips On 0% Balance Transfers
A major factor for calculating whether a 0% balance transfer make sense is if you can actually pay the balance back during the promotional period.
For an $8000 balance, you need payments of over $1330.00 per month to retire the balance within a 6 month promotional period. If cash payments like that aren't possible, you need to think about what happens when the promotional rate ends.
After the Promotion Ends.
Typically, after a promotional rate ends, you just pay at the regular interest rate on the remaining balance. So, you need to know what the standard interest rate is. It will help you calculate how much interest is on the remaining transferred balance once the promotion ends.
Figure out how much you can pay each month. Subtract that amount from the total balance. Let's say you paid $200 a month on an $8000 balance. 6 months later, you would still have a $6800 balance on your card.
Find out the interest rate for any remaining balance. If it is a higher interest rate than the rate you have now, then a 0% balance transfer may not make sense. Unless, you are absolutely confident you can pay the balance during the promotional period.
Pay Off the Balance.
Be diligent about paying off the balance within the promotional period. No late payments or other defaults on your agreement with the credit card company is ideal. Otherwise, you may find yourself paying much more once the interest rate defaults to a penalty rate under your contract terms.
Do not expect to transfer your remaining balance again once the promotional period ends. After the 2009 economic crisis, the days of easy credit and endless balance transfers are long gone. There is no guarantee another balance transfer offer will be available.
Cautious & Careful.
Many card companies charge a transfer fee of 3%. This is on top of an additional $50 or $75 fee.
Read the fine print. Many place interest rate escalation clauses in the fine print. If you miss a payment or are late, that 0% rate skyrockets to 25% or more.
Some credit card companies arbitrarily change the payment due date. It has been reported Discover Card moves the payment date up 4-5 days.
Dealing With Citibank.
Make sure you know if your 0% balance transfer is a cash advance or purchase.
Citi Cards does not let you pay higher interest charges (cash vs. purchase) separately or as a first choice.
Applying Payments.
Recently, I paid $4000 on my credit card with instructions to apply it to the cash balance. Citi said no! They decide how your payment is applied. $3500 was applied to purchases/interest. $500 was applied to cash advance/interest. After interest, only $130 was applied to the cash balance! $3200 was applied to puchases.
Customer Service.
Just a few months ago, 15% interest was the rate for both my cash advances and purchases. The rate was raised to 20% for purchases and 30% for cash advances. Citi agreed to lower the interest to 15% and 22% for 6 months.
After speaking with 3 levels of hierarchy, I spoke to someone with the authority to lower my interest rates. So, be careful with those 0% balance transfer cards!
When Do 0% Balance Transfers Make Sense
When considering how to deal with your debt, a common question is "How do I calculate if 0% balance transfers make sense?"
How It Works.
Credit cards offering 0% balance transfers are promotions used by creditors to attract customers. You get to transfer credit card balances onto the new card. This is up to the credit limit of the 0% balance transfer credit card. You pay 0% interest on the debt transferred for a pre-determined period. Usually, it's between 6 months and 1 year.
After the 0% balance transfer offer expires, any remaining balance is charged interest at the regular interest rate, according to the terms of the credit card. Expect a 0% balance transfer to charge you a fee when you transfer a balance to the credit card. The industry standard fee is 3% of the balance you transfer.
Running the Numbers.
If you are going to transfer a balance from another credit card, first you need to determine if you are going to save enough interest to cover the transfer fee. Basically, you look at the transfer fee and subtract that from the interest you are currently paying on the debt. If the number is positive, the 0% balance transfer makes sense. If it is negative, then don't transfer the balance. You probably have a threshold of how positive the number should be.
Credit card interest rates vary widely. It can go from around 5% to more than 20%! It depends on your credit score and other factors. The interest rate you are being charged should make a huge difference in determining whether to do a balance transfer.
Looking at Low Interest.
Suppose you have a 5% interest rate and your balance is $1000. You are paying 5% annually on a $1000 debt. Creditors charge interest in different ways. Let's take interest charges on a double month cycle.
Assume you make minimum payments of 3% per month of the balance remaining. After 6 months, you pay approximately $23.37 in interest. After 12 months, you pay $42.79 in interest.
If the 0% balance transfer offer lasts 6 months, then it may not be right for you. While you save $23.37 in interest, you have to pay a $30.00 transfer fee (3% of $1000). However, if the 0% balance transfer offer lasts 12 months, you save almost $13.00 ($42.79 in interest savings - $30 fee). While this is a savings, it is up to you to decide whether it's worth the hassle to transfer the balance.
High-interest Savings.
Suppose your credit card interest rate is 15%. Assume the same $1000 balance and minimum monthly payments of 3% of the balance. You have $71.66 in interest after 6 months and $134.94 in interest for 12 months. With a 3% balance transfer fee of $30.00, the offer looks much better.
Suppose your credit card interest rate is 20% and everything else is the same. You pay $96.59 in interest charges after 6 months. It is $184.48 after 12 months. In this situation, a 0% balance transfer makes a lot of financial sense.
Big Savings.
It seems clear that higher interest rates make 0% balance transfers a wise choice. The rule applies to high balances, too! Consider an $8000 balance, on a credit card charging 20% interest. After 12 months, you pay $1475.89 in interest. With a $240 balance transfer fee (3% of $8000), you would save a lot on the transfer.
What is a 0 Balance Transfer?
The 0% Balance Transfer - What is it?
One way to decrease credit card debt, while avoiding exorbitant interest fees, is to use a 0% balance transfer credit card offer. It might seem like a waste of time at first glance because you are opening a new credit card account to get rid of credit card debt. However, it can be a remarkably effective way to save on interest payments and reduce credit card debt.
Marketing Ploy by the Credit Card Companies?
0% balance transfer offers are used by credit card companies to increase their number of open credit card accounts. Likewise, it increases the amount of debt held in those accounts. While 0% balance transfer offers are effective for the credit card companies, if used properly, they can be an aid to customers, too! As a customer, you can save money and pay off credit card debt faster.
Accepting the Offer.
Using a 0% balance transfer offer, a customer opens a new credit card account. Generally, these offers are not too difficult to find.
Be aware some 0% balance transfer offers are longer than others. Longer is better. Be aware of the interest rate AFTER the period of zero interest expires. Expect a significant interest rate increase. However, some companies charge extremely high interest rates after the end of the initial no interest period. This is why it is so important to read the fine print very carefully before using one of these offers.
Your Account Has Been Opened.
After the new account has been opened, you call the credit card company to transfer other credit card balances to your new account.
The credit card company offering the 0% balance transfer will be very helpful in getting your other debt transferred onto your new card. This is because they want as much credit used on that new account as possible, right to the limit! How you manage your new account after the transfer will make the difference in how much interest you save over the course of the 0% interest period.
You've Transferred You're Other Credit Card Debt.
After you transfer high-interest credit card debt to the 0% account, this is the best time to pay on that balance as much as you can. This gives you the chance to eliminate the credit card debt without incurring any interest charges at all. You would be saving significant amounts on the account.
You must know how much time you have until the 0% offer expires. If a balance still remains, after the 0% balance transfer expires, you may be able to open another 0% balance transfer credit card account with another company. This lets you continue getting 0% interest longer. You want to look for the offers with the longest period at 0%. The longer the period, the more chance you have to diminish debt and save interest.
Capital One – Tricks That Get You In Trouble
Be Careful With That 0 Balance Transfer.
Let's say you have a credit card with Capital One and there is an existing balance on it. Now, suppose you make a 0% balance transfer to your account. Well, you can never pay off the initial balance until the account is completely paid!
They charge you interest unless the account balance is down to $0.00 and for 1 month after that, until the account is payed off.
Be aware of this if you do a balance transfer with a Capitol One credit card. They will find a way to charge you interest. They do not care if you never do business with them again. For them, they can always find another customer.
Handling Finance Charges.
Capital one takes more days than allowed by law to post online payments. Then they charge late fees.
Don't bother calling them since they use overseas people with a script. You just get the same canned answers over and over. They don't say anything else. They say...
- no to everything,
- they can't do that,
- they can't help you, or
- that's the policy.
They just repeat this repeatedly.
I did a 0 balance transfer for some large charges regarding hotel stays for a government move. The manager credited each of my charges to that card reducing the balance to zero, EXCEPT there is NO WAY to pay it off each month.
The balance is always more. It doesn't matter if you pay it the day the statement is printed or you pay when on the phone with them.
Another Experience.
I completed a 0 balance transfer form. It promised 0 percent interest for the life of the transfer. On April 14th, 2009, I received a letter. It stated...
"due to a system error, the balance transfer form should have stated 5.99%. However, no attempt will be made to collect any additional finance charges that should have been assessed from past balances."
Great move Capital one. Thanks a bunch! It's as if I signed-up for a fixed rate mortgage at 5%. Then, months later, receive a letter stating sorry, it's really 11.99%.
I tried to resolve this over the phone. My advice, don't bother. They were given a chance to correct the situation. So, now it's time to write a letter to Capital One. If that doesn't work, my next call will be to my state's attorney general.
0% for life.
I did a 0% balance transfer for 0%, for the life of the card.
3 months later, they tell me it was an error. Really, it should have been 5.99%. They said the only way they would honor the 0% percent is if I had the original application with the 0% for life offer on it.
Can you believe they sent me a letter with the original conditions, 0% Special Transfer for life. For 3 billing cycles, they have sent me a letter with the Transfer Special 0% offer. Let me repeat, the letter Capital One just sent me has the conditions they said were a computer error. It would seem that itself is proof of my original terms.
0 Balance Transfers
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Credit Help
Credit Report
Credit Rights
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Recent Posts
- Be Careful With 0 Balance Transfer Checks
- Talk to the Credit Card Companies
- Capital One – Online Agreement – August 2009
- New Credit Card Act, Balance Transfers & Loopholes
- How Do Banks Use ChexSystems
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