Credit Card News

The American Express Premier Rewards Gold Card now has a new offer for card members and their friends and family. Simply refer a friend who gets an American Express Premier Rewards Gold card (details below), and Amex will reward you with Membership Rewards bonus points. The offer is good until September 30, 2010 so check out some of the highlights. All card holders are eligible and there is no limit to what you can earn.

• 5,000 Membership Rewards® bonus points for each approved referral
• Refer 4 friends and they’re approved, you can get 20,000 bonus points
• No Annual Fee for the first year
• 10,000 bonus points for themselves when they use the Card for the first time
• 3X points on airfare, 2X points on gas and groceries, and 1X points for everything else

The American Express Premier Rewards Gold Card now offering 5,000 Bonus Points for any referral from a card member. If you referral a friend or family member and they are approved you can earn 5,000 Bonus Points for each referral. The cool thing is that there is no limit on the amount of people you can refer. So if you make 4 referrals you will get 20,000 Bonus Points. Keep in mind you are only awarded points when the person you refer a person they have to be approved. The points are redeemable for various rewards, like gift cards valued up to $200 from select retail and dining partners.

After your referral gets approved they also get to enjoy some special benefits from American Express. Each referral will get their annual fee waived for the first year, after that the fee will be $175. The new card member will also get 10,000 Bonus Points for them self after their first purchase. In addition, they will also get the normal benefits the card offers such as, 3X points on airfare, 2X points on gas and groceries, and 1X points for everything else.

Again, there is no limit on how many people you can refer as well as no limit on the Bonus Points you can get. Order to be eligible you have to refer your friends and family September 30, 2010. All you have to do is Log In to your online account and from there you can follow the process they have set up.

Have you visited a college campus recently? If you have then there is one obvious thing missing – the credit card companies! Until just a year ago it was common practice for credit card companies to be posted on college campuses offering free food, tee shirts, and whatever else they could come up with to entice students to apply. These sights aren’t so common anymore now that students are being restricted when it comes to being issued and using a credit card. One facet of the Credit Card Accountability Responsibility and Disclosure Act stops predatory lending practices and incorporates various provisions which protect students.

The New Rules
The act now prevents credit card companies from going after young adults as freely as they have in years before. If under the age of 25, credit card companies can no longer send in the mail pre-approval letters or free promotional gifts. To take it a step further, students under the age 21 have to either prove they have a sufficient income to manage a credit card or have a co-signer. Being a co-signer on a credit card for a young adult can be a risky move and one that should be considered only after knowing all the facts. Another option would be to be added onto a parents account as an authorized user.

The new regulations also forces universities to reveal their relationships with credit card companies to the Federal Reserve Board. This means that schools must be open about their marketing agreements with credit card companies, must share their business relationships and even report any payments made to the school by the credit card companies. In addition, the law encourages schools to provide debt management classes to students.

All these changes have been put in place to protect students and young adults. It is a result of all the massive amounts of debit young adults are accumulating because they are sucked into the buy now pay later scheme. The amount of people who have bad credit is outrageous and these regulations have been put in place to stop this from happening. Today having good credit is more important than ever, especially now that we are hearing more and more about potential employers using peoples credit reports to determine if they should be hired or not. One day students and young adults will hopefully appreciate these measure that have been taken to protect them and their credit.

Co-Signing – Is It A Good Idea?
Co-signing on anything, like a credit card, should not be taken lightly. Here’s why – it is reported that 1 out of every 4 people who co-sign a loan end up paying the balance. When you co-sign you are agreeing to take full responsibility of the account if the account holder does not follow through. In other words you are 100% liable for the account. Here are somethings to consider before co-signing:

• If you co-sign and the borrower misses a payment, the lender can collect from you immediately.
• You are being asked to guarantee someone else’s debt when you co-sign a loan.
• If you co-sign be sure you can afford to pay the loan.
• Your liability for the loan may keep you from getting other credit you may want.

The Credit Card Act of 2009 implemented new rules for credit cards and gift cards were rolled out in stages starting last summer and now several provisions are set to be effective on August 22, 2010. The final round of rules will benefit both credit card users and gift card users. The new rules state that your credit card late fee can’t exceed your minimum payment. If you minimum payment is $15 then your late fee can at the most be $15. The new rules will also do away with “inactivity” fees and will require credit card companies that increase your interest rate to re-evaluate that increase six months later.

Changes To Gift Cards
The new gift cards provision known as H.R. 5502, states that gift cards can’t expire before five years. This means if you load money onto a gift card the expiration date has to at least be five years from when you purchased the card. The act also requires gift cards to be replace upon customer request by the card issuer. Card issuers also have to provide these new disclosures along with any gift card purchases so consumers know their rights. These new rules have been created for the sole purpose of protecting consumers.

Currently gift cards typically have an expiration date of one year. If the card is not used within a year of purchase then the card is not valid. Lawmakers think this is unfair which is why they have elected to extend the expiration date out to five years. The new laws also protect consumers against balance draining fees. No fee can be charged to the card unless the card hasn’t been used for one year and even then there can only be one charge a month.

If this act is accepted then some 100 million gift cards would have to be destroyed and reissued. That’s a lot of plastic! According to Representative Dan Maffei who sponsors this legislation, this many gift cards is “equivalent to eight football fields filled 12 feet deep with plastic card.” The president has signed the act and it is set to go into place August 22, 2010. To see the official summary of H.R. 5502 you can visit the Library of Congress. There are 4 versions of Bill Number H.R.5502 for the 111th Congress.

Most of us already have a hard time living without our cell phones and now its going to be even more difficult. The word on the street is that AT&T, Verizon, and TMobile have plans to team up to give the credit card companies some competition by allowing customers to use their smartphones as a form of payment instead of swiping a credit card. Smartphone users would be able to simply wave their phone in front of a wireless reader and their payment is complete. It sounds a little far out there, but apparently there has been talk in the works for several years.

According to sources cited by Bloomberg, these top wireless companies have plans to test this new service out in stores in Atlanta and in three other cities that have not been released yet. The details are a little fuzzy, but we know the technology will likely include a radio frequency identification tag that would somehow be embedded into the smartphone and linked to the users account. Smartphones can already do just about everything and soon they might even be able to pay for your groceries. This type of technology has been used in other countries like Japan, Turkey, and the U.K.

Bloomberg also reports that credit card companies like MasterCard and Visa have been investing in such mobile technology options for years now. They have launched similar systems that used the same RFID technology but it hasn’t quite caught on yet. It is reported that Visa has developed an iPhone App with DeviceFidelity which gives people the option to store payment information for multiple credit card accounts. Similiarly, MasterCard is still hyping up its PayPass service and has even developed a PayPass stickers that goes on the back of mobile phones. It will be interesting to see if the top wireless providers make this happen and further set smartphone users apart from the rest.