March 4th, 2010
Capital One has released a new 2% card, the Venture. Users earn 2 No Hassle Miles per $1 spent, with a $59 annual fee. The company has also released a no-fee version that pays 1.25 No Hassle Miles per $1 spent.
While we’re happy to see a new 2% card, we continue to believe the Fidelity & Schwab 2% cash cards, as well as the Discover Escape, are much better options. This is because No Hassle Miles can’t be exchanged for airline miles, and are a bit of a pain to redeem, whereas the other cards are either cash back cards or redeemable for cash. Also, the Discover Escape has a more generous signing bonus (1,000 miles per month for the first 25 months) than Venture (10,000 miles after spending $1,000 in the first 3 months).
On a positive note however, it is unusual to find a 2% card on the Visa / MasterCard network, and if that is your primary concern, the Venture is as good a choice as any.
Posted in Capital One | 2 Comments »
March 4th, 2010
PenFed has released the PenFed Promise credit card, a great no-frills low apr card with a fantastically low 7.49% introductory APR fixed for 3 years.
According to our new Balance Transfer calculator, which takes into account both introductory promotional balance transfer rates, as well as balance transfer fees, this card is one of the top 5 balance transfer cards available – if you plan to transfer a balance for 3 years. Most cards with low introductory balance transfer rates have a 3%+ transfer fee, PenFed Promise has no fees at all.
One other great feature of this card is the No Fee cash advance rate of 17.99%, which is unusual because most issuers charge a cash advances fee of 3% or more, and typically charge an average rate of 22.2%. You can see that the card ranks #22 out of 302 cards in terms of cash advance rate on our PenFed Promise home page.
We appreciate the simple to understand, no gimmicks offering, and encourage other card issuers to keep things simple as well.
Posted in PenFed | No Comments »
March 4th, 2010
One part of the Credit CARD act that didn’t get nearly enough press was a requirement for the Fed to create rules forcing credit card fees to be “reasonable and proportional”. So yesterday, the Fed jumped in the ring with the following proposals to protect consumers:
- No inactivity fees. Your bank won’t be able to siphon money out of you when you’re not using your card.
- No double-dipped fees. So you can’t be charged twice for the same penalty (like a late payment).
- No disproportional fees. Specifically, they can’t charge you a fee that’s higher than the dollar amount involved in the offense. I.e. if you miss a $10 payment, they can’t charge you a $50 penalty.
- Card issuers have to specify why they’re raising rates. So if your bank is raising your interest rate, they not only have to tell you in advance, but they have to give you a specific reason why.
- Reevaluate reasons for raising rates since Jan 2009. If a bank has raised rates in the last year (which they all have) it will be required to reevaluate its reasons and lower rates if that’s called for.
Ever since the CARD Act was announced, banks have been coming up with new (and quite creative!) fees to make sure they don’t lose their golden goose, so it’s nice to see the Fed step in and try to nip that in the bud.
The rules around limiting fees are unambiguously good for consumers, but I’d love to hear what kind of reasons they use to justify raising rates (probably good material for a humor site, note to self). And I have a hard time believing that banks are going to spend much time reevaluating their reasons for raising rates, finding religion, and consequently lowering them. They have a long and illustrious history of doing precisely the opposite.
If you have any opinions on ways the Fed can help, they’re taking public comment on the regulations for 30 days, and the information is on their site. Also feel free to comment below.
These rules are intended to go into effect on August 22, 2010.
Posted in Regulations | No Comments »
March 1st, 2010
Are you interested in a rewards program, but sometimes carry a balance? You probably think a low APR card can’t come with Rewards? Think again. NerdWallet has scoured the credit card market to find you credit cards that combine a low ongoing APR with a rewards program by credit score.
Average Credit:
Our Top Picks
The Classic from First Command Bank is in a league of its own, offering 10.25% APR, 1% ScoreCard Rewards, no annual fee and 0% balance transfer fee.
Miles by Discover® Card, has no annual fee, a 12.99% APR and 1% reward rate. Additional promotions include 0% APR and 0% balance transfer fee for 6 months, and 12,000 Discover Bonus Miles upon signing up.
Good Credit:
Our Top Pick
Our top choice for those with Good Credit is the Air Force Association card from Chase. This card features an ongoing APR of 9.24%-14.99% (based on credit quality), NO annual fee and 1% Chase Flexible Rewards Points. Promotional 0% balance transfer fee for the first 6 months.
Honorable mentions
Barclays offers a few solid choices, including the Rec, Coast to Coast and Good Sam Club cards. All feature 1% rewards with no annual fee and on-going APR from 9.49%. Particularly appealing about these cards is the promotional 12 month 0% balance transfer fee offer.
Important Considerations:
A few final thoughts to keep in-mind before opening a new credit card. 1) You’ll only receive rewards for the amount you pay off. If you carry a balance at the end of the month, you won’t receive all of your reward points. 2) If you’re working to pay-down debt and opening a new card to transfer an existing credit card balance to a lower interest card, be sure to know what the Balance Transfer Fee is for your card. The industry average is 3%, but some card companies offer 0% introductory offers for the first 6-12 months. See Balance Transfer for our rankings.
Posted in Low APR Cards with Rewards Programs | 2 Comments »
February 28th, 2010
As many of us have learned from personal experience, your credit card company can make a killing off of your purchases overseas. What do I mean? When using your credit card internationally, your network (MasterCard, Visa, Discover and American Express) will add a 1% foreign currency conversion fee to all transactions you make. Add the 2% fee most US banks tack on, and you have a nice 3% charge on all purchases you make out of the US. Want to know what your network is charging you? Keep reading.
What are you being charged?
Here are current foreign transaction fees for some of the largest US card issuers:
| Issuer |
Foreign Transaction Fee |
| American Express |
2.7% |
| Bank of America |
3% |
| Barclays |
3% |
| Capital One |
0% |
| Chase |
3% * |
| Citibank |
3% |
| Discover |
2% |
| Fifth Third Bank |
3% |
| HSBC |
3% * |
| US Bank |
3% |
| USAA |
1% |
| Wells Fargo |
3% |
Tired of paying these foreign transaction fees? There is a solution: Capital One. Our research indicates Capital One is the most generous large card issuer in-terms of foreign transaction fees, offering no foreign transaction fees and eating the 1% fee charged by Visa or Mastercard. While we’re not suggesting everyone go out and sign up for a new card right now, if you’re a frequent overseas traveler, you may want to consider getting a no or low foreign transaction fee card before your next trip.
The Exchange Rate Matters Too
Keep in mind, your credit card company also has the freedom to charge you an unfavorable exchange rate, in addition to the foreign transaction fee. American Express has a reputation for giving cardholders favorable exchange rates, despite their 2.7% fee, so in theory you could actually end up paying more using Capital One. NerdWallet is working on an “Around the World” report where we charge the same item using several different cards in several different countries to see where things really shake out.
Go for Local Currency
One last piece of advice. When making a purchase overseas, make sure you’re charged in the local currency. Often, foreign merchants will offer to charge you in U.S. dollars instead of the local currency. While this may seem easier, some merchants have been known to wait three-or-four days for the highest exchange rate.
* While HSBC and Chase offer lower charges to a small number of “premier” customers, the majority of their cards charge 3%.
Posted in Foreign Transaction Fees | 1 Comment »
February 28th, 2010
FICO is the most commonly referenced credit score, developed by Fair Isaac Corporation. This one number ranging from 300 to 850 tells credit card issuers, auto dealers, and mortgage lenders how trustworthy you are with their money. Then based on this number they decide whether or not to lend you money, and how much to charge you for it. As a general rule, the lower your credit score, the higher the interest rate (or APR) you can expect to pay.
If you are only interested in examining your credit report to make sure there are no anomalies, you can get it for free (really) once a year, at a site mandated into existence by law – AnnualCreditReport.com.
Unfortunately things get a little more complicated if you want to know your credit score. If you have no idea what your credit score is, we recommend going to a reputable resource to figure it out. Of the links below, 2 are owned by one of the big 3 reporting agencies, and the other is the aforementioned Annual Credit Report:
- CreditReport.com – The most obvious result, given its name. They offer a free credit report and score, but you have to sign up for a credit monitoring service that will charge you a monthly fee ($14.95 as of writing). Then they will send you email alerts of any changes to your Experian, Equifax, or TransUnion credit score. You can avoid the monthly charge by canceling in the first 7 days.
- Equifax Credit Watch Gold 3 in 1 – From Equifax – For a monthly fee ($14.95 as of writing), those who want to continually monitor their credit reports from the 3 bureaus (Expirian, Equifax, Transunion), as well as receive 4 FICO scores per year, may find this service useful. The Equifax website states that there is $1,000,000 in Identity Theft Insurance included. Subscribers can cancel within the first month if you do not like the service.
- FreeCreditReport.com – From Expirian – You may recognize the name from the commercials with the annoying jingles. This service is almost identical to CreditReport.com in every way – you sign up for monitoring in exchange for a free credit report and score. But then you get a 9-day grace period during which you can cancel and avoid the monthly charge.
- AnnualCreditReport.com – Created after the passage of the FACT Act of 2003, this site allows you to access one free credit report from each of the three agencies once per calendar year. However you only get the report; they still charge you to find out your actual score ($7.95 as of writing).
There are also some resources to help you estimate your credit score, but these sites don’t clue you in to potential identity theft or your actual score. Credit.com is recommended by Money Magazine’s editors. BankRate.com also has an estimator tool.
Of course knowing what your score is today is only half the battle. If you don’t sign up for one of the credit monitoring services listed above, you should make it a point to check your credit score on a regular basis and keep it from heading lower. With careful management of your credit card debt and diligent payment of your other bills, you should be able to move yourself squarely into the “excellent” category and avoid paying those painfully high APRs!
Posted in Credit Score | No Comments »
February 27th, 2010
Still one of the best rewards cards.
Despite dropping the base rewards rate from 1.25% to 1.00% this week, the Pentagon Federal Union – PenFed Cashback Rewards card remains one of the best cash rewards cards out there for people with excellent credit.
5% on gas, Visa network acceptance, no annual fee.
What makes the card so unusual is the 5% cash back on gas and 2% at supermarkets, and that it is a Visa, which makes the generous rewards program even more surprising (banks issuing Visa and MasterCard network cards charge merchants lower fees than Discover and American Express, usually resulting in less generous rewards). Also, the card has $0 annual fee.
To put things into perspective, the best gas rewards cards offered by Lukoil/Getty only offer 4% at their gas stations. Furthermore the Blue Cash card requires you to spend a total of $6,500 per year before achieving a 5% cash back rate on gas, though with the 1.25% rewards rate after $6,500 you could end up better off if you spend a lot each year.
Joining PenFed.
The only catch is that you have to join the PenFed credit union. This is easy if you are affiliated with the military, Red Cross, or one of many other organizations. However, anyone can join the credit union by donating $20 to NMFA or volunteering for the Red Cross.
Posted in PenFed | No Comments »
February 23rd, 2010
Phase two of the CARD act has driven numerous revisions to APR’s and card offers.
- First National Omaha Bank, Heartland Bank, and KeyBank raised APR’s across the board.
- Citibank raised APR’s on most airline and retailer cards.
What does this mean for you?
If you carry a balance, many of the 7.99% APR rates from Heartland Bank and 8.99% APR rates from First National Omaha Bank are no longer an option. However, there are still many great options available at 7.25% for those with Excellent Credit. We endorse the Iberia Bank Visa Classic, or if you have pristine credit, the First Command Bank Platinum (the only ultra low APR card with no fee AND a 1% rewards program).
Posted in Citibank, First National Omaha Bank, Heartland Bank, KeyBank | 2 Comments »
February 22nd, 2010
Limited interest rates hikes. 45 day advanced notification for most fee changes. No interest rate increases for the first 12 months of holding an account. These are just a few of the new changes to the card industry. In short, The Credit Card Accountability, Responsibility and Disclosure Act of 2009 (the Credit CARD Act), which came in to effect today, is aimed at preventing banks from sneakily raising interest rates and changing terms on an account, which ultimately lead consumers deeper into debt.
Some of the key features of the CARD Act include:
- Limited interest rate hikes: increases in interest rates on existing balances will be limited to specific conditions, including the end of a promotional rate period, variable rate changes or if the cardholder misses a payment
- Minimum 6 month promotional interest rate period
- 45-day advance notice required for most fee changes, including pending rate or fee increases
- Issuers must notify card holders of the right to cancel a card (“opt out”) if the holder doesn’t agree to changes in the terms of the account
Young Adults:
Young adults under 21 years of age will need to have an adult co-signer to open a new credit card account, or show proof of income.
Poor Credit History:
Looking to apply for a credit card, but have poor credit card history? Beware. While the credit card act stipulates that upfront account-opening fees cannot exceed 25% of the initial credit limit, some issuers are considering absurdly high interest rates on these accounts, with one card company quoting a 59.9% APR
Corporate Credit Cards:
It’s important to note that the new laws only affect consumer credit cards, not corporate cards. If you have a business card, be sure to stay on top of changes in the terms and conditions of your card.
Once the new regulations are fully phased in by December 2010, the credit card industries marketing, billing and advertising will be fundamentally changed. This also means the credit card companies will need to reign in their rewards programs and potentially increase annual fees.
Posted in Card Changes | 1 Comment »
February 22nd, 2010
Wells Fargo has raised APRs across the board. The biggest increases are on College Visa and CashBack College Visa, ahead of the new CARD law requiring credit card applicants under the age of 21 to co-sign with a legal guardian.
- Minimum APRs on the Wells Fargo College Visa card and Cash Back College Visa card were increased by 3% to 14.65% and 15.65%.
- Wells Fargo Visa Platinum card minimum APR was raised 1% from 10.65% to 11.65%.
- The remainder of the credit card portfolio was raised 1% from 12.65% to 13.65%.
Posted in Wells Fargo | No Comments »
