What are the cash advance features?

 Some credit cards let you borrow cash in addition to making purchases on credit. Most credit card companies treat these cash advances and your purchases differently. If you plan to use your card for cash advances, look for information about

 Access. Most credit cards let you use an ATM to get a cash advance. Or the credit card company may send you “checks?that you can write to get the cash advance.

     APR. The APR for cash advances may be higher than the APR for purchases.

     Fees. The credit card company may charge a fee in addition to the interest you will pay on the amount advanced.

      Limits. Some credit cards limit cash advances to a dollar amount (for example, $200 per cash advance or $500 per week) or a portion of your credit limit (for example, 75% of your available credit limit).

     How payments are credited. Many credit card companies apply your payments to purchases first and then to cash advances. Read your credit card agreement to learn how your payments will be credited.

    How much is the credit limit?

The credit limit is the maximum total amount--for purchases, cash advances, balance transfers, fees, and finance charges--you may charge on your credit card. If you go over this limit, you may have to pay an “over-the-credit-limit fee.?

What kind of card is it?

Most credit card companies offer several kinds of cards:

Secured cards, which require a security deposit. The larger the security deposit, the higher the credit limit. Secured cards are usually offered to people who have limited credit records--people who are just starting out or who have had trouble with credit in the past.

    Regular cards, which do not require a security deposit and have just a few features. Most regular cards have higher credit limits than secured cards but lower credit limits than premium cards.

    Premium cards (gold, platinum, titanium), which offer higher credit limits and usually have extra features--for example, product warranties, travel insurance, or emergency services.

Does the card offer incentives and other features?

Many credit card companies offer incentives to use the card and other special features:

Rebates (money back) on the purchases you make

     Frequent flier miles or phone-call minutes

     Additional warranty coverage for the items you purchase

     Car rental insurance

     Travel accident insurance or travel-related discounts

     Credit card registration, to help if your wallet or purse is lost or stolen and you need to report that all your credit cards are missing

     Credit cards may also offer, for a price,

     Insurance to cover the payments on your credit card balance if you become unemployed or disabled, or die. Premiums are usually due monthly, making it easy to cancel if the payments are higher than you want to pay or you decide you don’t need the insurance any longer.

     Insurance to cover the first $50 of charges if your card is lost or stolen. Under federal law, you are not responsible for charges over $50.

Before you sign up to pay for any of these features, think carefully about whether it will be useful for you. Don’t pay for something you don’t want or don’t need.

How do I find information about credit cards?

You can find lists of credit card plans, rates, and terms on the Internet, in personal finance magazines, and in newspapers. The Federal Reserve System surveys credit card companies every six months. You’ll need to get the most recent information directly from the credit card company--by phoning the company, looking on the company’s web site, or reading a solicitation or application.

Under federal law, all solicitations and applications for credit cards must include certain key information, in a disclosure box similar to the one shown.

APR for purchases. The annual percentage rate you抣l be charged if you carry over a balance from month to month. If the card has an introductory rate, you抣l see both that rate and the rate that will apply after the introductory rate expires.

APR for purchases. The annual percentage rate you’ll be charged if you carry over a balance from month to month. If the card has an introductory rate, you’ll see both that rate and the rate that will apply after the introductory rate expires.

Other APRs. The APRs you’ll be charged if you get a cash advance on your card, transfer a balance from another card, or are late in making a payment. More information about the penalty rate may be stated outside the disclosure box--for instance, in a footnote. In this example, if you make two payments that are more than ten days late within six months, the APR will increase to 23.9%.

Variable-rate information. Information about how the variable rate will be determined (if relevant). More information may be stated outside the disclosure box--for instance, in a footnote.

Grace period for repayment of balances for purchases. The number of days you’ll have to pay your bill for purchases in full without triggering a finance charge.

Method of computing the balance for purchases. The method that will be used to calculate your outstanding balance if you carry over a balance and will pay a finance charge.

Annual fees. The amount you’ll be charged each twelve-month period for simply having the card.

Minimum finance charge. The minimum, or fixed, finance charge that will be imposed during a billing cycle. A minimum finance charge usually applies only when a finance charge is imposed, that is, when you carry over a balance.

Transaction fee for cash advances. The charge that will be imposed each time you use the card for a cash advance.

Balance-transfer fee. The fee that will be imposed each time you transfer a balance from another card.

Late-payment fee. The fee that will be imposed when your payment is late.

Over-the-credit-limit fee. The fee that will be imposed if your charges exceed the credit limit set for your card.

What are your liability limits?

If your credit card is lost or stolen--and then is used by someone without your permission--you do not have to pay more than $50 of those charges. This protection is provided by the federal Truth in Lending Act. You do not need to buy “credit card insurance” to cover amounts over $50.

If you discover that your card is lost or stolen, report it immediately to your credit card company. Call the toll-free number listed on your monthly statement. The company will cancel the card so that new purchases cannot be made with it. The company will also send you a new card.

Make a list of your account numbers and the companies’ phone numbers. Keep the list in a safe place. If your wallet or purse is lost or stolen, you’ll have all the numbers in one place. Take the list of phone numbers--not the account numbers--with you when you travel, just in case a card is lost or stolen.

What can you do about billing errors?

The federal Fair Credit Billing Act covers billing errors. Examples of billing error are

A charge for something you didn’t buy

     A bill for an amount different from the actual amount you charged
     A charge for something that you did not accept when it was delivered
     A charge for something that was not delivered according to agreement
     Math errors
     Payments not credited to your account
     A charge by someone who does not have permission to use your credit card

If you think your credit card bill has an error, take the following steps:

   1.  Write to the credit card company within 60 days after the statement date on the bill with the error. Use the address for “billing inquiries” listed on the bill. Tell the company
Your name and account number,
That you believe the bill contains an error, and why you believe it’s wrong, and
The date and amount of the error (the “disputed amount”).

   2.  Pay all the other parts of the bill. You do not have to pay the “disputed amount” or any minimum payments or finance charges that apply to it.

If there is an error, you will not have to pay any finance charges on the disputed amount. Your account must be corrected.

If there is no error, the credit card company must send you an explanation and a statement of the amount you owe. The amount will include any finance charges or other charges that accumulated while you were questioning the bill.

What if the item you purchase is damaged?

The federal Fair Credit Billing Act allows you to withhold payment on any damaged or poor-quality goods or services purchased with a credit card--even if you have accepted the goods or services--as long as you have made an attempt to solve the problem with the merchant.

The sale must have been for more than $50 and must have taken place in your home state or within 100 miles of your home address. You should notify the credit card company in writing and explain why you are withholding your payment.

You may withhold the payment while the credit card company investigates your claim. If you pay the charges for the goods on your credit card bill before the dispute is resolved, you will lose your right to make a claim.

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