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Credit Card Tips

Picture of Dolar Tips With credit cards, similar advice always applies: Search and shop around, use cards lightly and be sure to settle your dues on time. Less obvious is how to manage credit cards in light of new regulations given by the Dodd-Frank Act, Federal Reserve regulations and the Credit CARD Act. Sum these up, these rules give more disclosures to clients, more security, and significant loopholes each cardholder must be familiar with.

Tip 1
Bring cash or debit for minimum purchases

The interchange fee reform gives opportunities for retailers and other merchants to impose a minimum purchase cost for credit card transactions. Visa posted on their site, “The minimum purchase must go above 10 US dollars and does not apply to transactions made using debit cards”. Before, a few merchants imposed credit card minimums on clients, but did so in violation of card network regulations. Sellers can now impose a 10 US dollars credit card minimum without having to worry about any penalty. Prevent this possible restriction by always bringing at least 10 US dollars or a debit card in your purse.

Tip 2
Are you below 21? Know the new rules for applying for a credit card

Under the Credit Card Accountability, Responsibility and Disclosure Act of 2009, or Credit CARD Act, if you are below 21 years old, you are required to present a proof of income or assets, or a co-signer to obtain a card. Issuers are not forced to offer a co-signer choice, but asked some of the major card issuers lately and found that a few don’t allow co-signing.

Before forwarding your application form, check with the card issuer to know what the policy and method is when it comes to applicants younger than 21 years old.

Keep the credit card agreement summary

Aside from the credit card agreement itself, new cardholders are required to get a single-page agreement summary, as stated by Federal Reserve regulations that took effect last July 2010. The summary must put emphasis on the key terms of your agreement. Keep it for future use or reference. In addition to the credit card agreement itself, new cardholders must receive a new credit card disclosure rules, as

Tip 4
Look for changes to previous or existing accounts

Under the CARD Act, issuers must give notice of specific modifications to accounts 45 days before they take effect. For example, issuers must allot 45 days' advance notice before setting a much higher minimum payment. The law doesn't demand advance notice of all modifications, however. New policies that don't have to be notified ahead of time include credit limit deductions and closures of present accounts.

Tip 5

Use credit cards you don't like to lose barred issuers from requiring clients to pay for inactivity of cards; nothing stops an issuer from closing an unprofitable account or lessening the credit limit. Based on a study about card fees conducted last 2010, some issuers close accounts if they are proven inactive for quite some time.

While there are no guaranteed ways of stopping an unwanted closure, it is wise to use the cards regularly you like to keep. Pay the full amount to avoid credit card debt.