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Credit Alerts - 2007
IT'S IN THE "FINE PRINT"...April 7
Credit card companies do a great job at disclosing all of their terms and conditions...but do so in an exceptionally hard to read font and verbiage, designed to dissuade you from really reading the infamous "fine print". But failing to understand the terms can be costly.Most people know that when your bill arrives, it needs to be paid on time or you'll be hit with a hefty late fee - but many don't know that paying late usually entitles the credit card company to raise your rate immediately and significantly. And worse yet - did you know that paying late on one of your credit cards also entitles all your other credit card companies to raise the rates you are paying them as well? You bet - it's called the "Universal Default Clause", and it basically means that if you are late on one credit card account, all other credit card companies that you have accounts with can increase the interest rate too, even if their accounts have been paid completely on time.But the plot thickens further - this goes beyond late payments on credit cards alone.If one of your credit card companies has the Universal Default Clause noted in their disclosure - and most of them do - this clause states that they have the right to penalize a consumer with an increased interest rate if a late payment is reported to ANY other creditor, including utilities, car loans, and home loans. Better believe that credit card companies with this clause sit back and wait for the opportunity to increase the interest rate...and continually monitor their customer's credit reports, just waiting for the opportunity to do so.And just when you thought it couldn't get any worse......it's not just late payments that trigger the Universal Default Clause; interest rates can be increased if a consumer exceeds a credit limit, bounces a check, or applies for additional credit. All of these signs may be read by the credit card company that a consumer is "high risk". The penalty? You guessed it - a higher interest rate.Further, if an offer seems too good to be true, it probably is. This popular phrase rings true for many consumers that sign up for zero percent interest offers. Although these offers sound great and every consumer goes in with the best intentions of paying the balance in full before the zero percent interest term expires, the vast majority of people do not pay off the bill before the offer ends. And what consumers do not realize is if the account is not paid in full, the creditor does not start charging interest from the date the deal expires, the creditor goes back to the day the purchase was made and charges interest on the balance for the entire period.Or - back to the Universal Default Clause, if you are late on another credit card payment during the introductory time period with the zero percent rate offer - the card issuer of that sweet deal could prematurely break it off and force a steamed up interest rate, retroactively charged back to the original date of purchase. That smoldering rate could mean paying double or even triple for the purchased merchandise.Try your best to only charge what you can afford to pay off in full, on a monthly basis. Beyond being just good advice, here's another little known credit card fact that could cost you.If you charge and then pay the account in full, there is no interest due. But if you charge and choose to only pay half of the bill when it arrives, guess what - you get charged interest not just on the remaining balance, but for the entire charged balance, regardless of your paying half the bill in full. If the bill is not paid in full the following month, this game continues until the account is paid in full.So although the fine print can be a real snoozer to read, taking the time to become familiar with credit card terms and conditions can save you some serious dollars. Review your current credit card terms and conditions and take the time to find a credit card company that truly matches your spending habits and needs. You will save yourself a few sleepless nights - and more importantly, save yourself a lot of money too!
source: MMGW by permission
Credit Alert - April 2 2007
Thanks for shopping at TJ Maxx...but your credit card info is now fair game.That's right, if you shopped at TJ Maxx over the past few years, your credit card may be one of the 45 million - yes 45 million - that was accessed and copied in the biggest data leak ever. The card info was used to make duplicate dummy cards...and those cards were used to buy gift cards at WalMart and Sam's Club for $400 each, which is under the $500 threshold for showing identification. This is not the first time this has happened. You may recall the DSW Shoe security breach about a year earlier; and like Déjà vu, it's Déjà DSW all over again. And unfortunately, it's a good bet that something like this will happen yet again.You might be saying it's a good thing you have that security code on the actual card to show that you have it in your possession...but the latest scam is designed especially to gain that information.Scammers lure you into giving them the security code by impersonating themselves as employees of the credit card company, calling the cardholder, and acting as though fraud has already taken place in hopes that you will give up that precious three digit code. Here is how the call plays out.The caller identifies himself by name, badge number, and states that the call is from the Security and Fraud Department of Visa or MasterCard. They use the news about TJ Maxx and asked if you have shopped there in the past 4 years...a decent chance you have and have also heard about the data leak.The caller explains that your card has been flagged for an unusual purchase pattern, he is calling to verify a charge that was made to your account (reads the account number to you), and asks if you made a purchase in the amount of $497.99 to a Marketing company in Arizona for an Anti-Telemarketing Device? When you respond "no" the caller states that a credit will be issued but to issue the credit the caller needs the security code (the three digit code from the back of the card) to process the credit. You innocently pull out the card; give the caller the security code, and minutes later are hit with a charge not a credit in the amount of $497.99. Even though the scammers have your account number, name, and some personal information, this information is not always enough to make purchases and the scammers need the security code.Should you receive a call that is similar to the description above, take the following steps to protect your identity and your credit:· Do not give the caller the security code.· Ask for the caller's name and terminate the call.· Call the credit card company immediately, but do not call the number the caller provides.Additionally, here are a few extra steps you can take to protect your sixteen digit credit card number and personal information:· Be aware of your surroundings when purchasing merchandise. If the individual behind you in line is crowding your space, cover your credit card information.· Watch your card when individuals around you in public places have cell phones. Thieves can easily use a cell phone to take a snapshot of your credit card.· Shred all credit card receipts. Many merchants issue a charge receipt with the full account number and your name.
· Don't leave credit card statements lying around the house or office, file or shred statements once paid as they contain all of the information for a thief to perform this scam
source: MMGW
Alert - March 13th
HOTEL CREDIT CARD SCAM! When you're traveling for business or pleasure...how safe is your credit card while you're in your hotel room?
Most would answer "very safe" because the card is right there with you, either tucked securely in a wallet or locked in the safe. But beware...it might not be as protected as you think. There is a new scam lurking about hotels, and it's not coming from hotel employees - it's from people outside the hotel altogether. Here's how it works:
The phone in your room rings and the individual on the other end identifies themselves as someone from the front desk. They say there is a problem with your credit card and the number needs to be verified. You cooperatively pass along the information, and don't think about it again until the monthly statement arrives with a slew of charges that are not yours.
Suddenly you realize while on vacation or caught up in an important business trip, you were scammed!
So how do these individuals get to your room if they do not know your name? They simply call the hotel and randomly ask for room numbers until they can get through to a person in the room, or they ask for a hotel guest with a common last name like "Smith" until the connection is made. One way or another, they get through and scam hotel guests.
If a call is ever made to your hotel room requesting credit card information, taking just one precautionary step will confirm whether or not the call is a legitimate one. Simply ask for the hotel employee's name and tell them you will come down to the front desk and provide the credit card information. Asking for the name may cause the scammer to panic and hang up - but even if a name is given, take the time to go to the front desk and confirm the call. According to the American Hotel and Lodging Association, hotels never ask for credit card information over the phone. So, chances are good that receiving a call like this is a scam, and taking the time to walk down to the front desk will confirm whether there really is a problem with your card.
Be on guard for anyone asking for your credit card number over the phone, and ensure that you can enjoy your vacation or focus on that business trip with the peace of mind that you are not getting scammed.
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