7 Unwritten & Often Forgotten Credit Card Secrets
Credit card companies are just like every other business. There are essentially three concepts to understand when dealing with a business, especially credit cards:
- They exist to make as much money as possible,
- They have relatively well documented rules and operating procedures,
- They’re willing to break #2 in pursuit of #1.
So, to that end, here are 7 unwritten and often forgotten credit card tricks or “secrets” (I hate the term “secrets” because how much of a secret can they be if I know it?) that may save you a few bucks someday. If you don’t learn a single secret or you have a secret of your own, please let me know! Secrets are better when you tell everyone!
1. Just ask: Lower interest, reduce or eliminate fees
This is truly the best tip of the bunch, hence the top billing, and everything else looks like chopped liver compared to this bit (despite how popularized it’s been of late). The credit business is extremely competitive, take advantage of it by asking for what you want. If you made a late payment and were assessed a late payment fee, call them up and request that they take it off. If your interest rate is too high, call them up and request that they lower it. If they decline, simply tell them that you want to cancel the card or that you’ll take advantage of a new offer that you just received in the mail. They make so much money from you when you spend (they charge the merchants a processing fee) that the piddly late fee pales in comparison to the riches they will reap by keeping you as a customer. If they don’t budge, punish them by taking your business elsewhere.
2. Roll credit limits of the same issuer onto fewer cards
This is a popular one with 0% balance transfer junkies because Citi has a “not so often spoken” rule of limiting a cardholder to at most three lines of credit (without regard to the actual dollar limit). This stinks for balance transfer arbitragers because they want to keep rolling that 0% balance from card to card to card and that gets dicey if they can only have three. One way of getting around this rule is to ask that you roll the credit limits of one of the cards into another one of the cards. They are generally willing to do this because the alternative is that you cancel the card and they lose the business. Since they were willing to give you the total limit in the first place, putting it on two cards instead of three hardly makes a difference to them. This has an added benefit for you from a credit score perspective - you reduce the number of open lines of credit while keeping your credit utilization and total credit limit the same. Double win!
3. Request an increase to the credit limit without a credit pull
I’ve written about how you can request a credit limit increase in the past and not get a credit pull but I wanted to repeat it in a post like this because it’s something not a lot of folks know. What you basically do is, through your online account management portal, go through the normal process of requesting a credit limit or line of credit increase. Sometimes, based on how long you’ve been with the issuer and your credit worthiness, they may offer you an increase on the spot without a credit inquiry. Do not bother trying this within the first six months or first year with the card, they generally won’t offer this without a credit pull so you’d just be wasting your time.
4. Capital One & Discover don’t have a foreign transaction fee charge
When you purchase something overseas, your credit card will often charge you a foreign transaction fee to handle the foreign exchange process for you. In fact, part of that fee is imposed by Visa and MasterCard itself, so any Visa and MasterCard that charges you less than 1% is actually eating the fee. Capital One and Discover are the only two companies that do not charge a foreign transaction fee; Capital One actually pays the fee for you and Discover, since it’s not on the Visa or MasterCard network, just doesn’t charge for it. As I wrote in the other article, if you want to pick between the two then I’d go with Capital One because Discover isn’t as widely accepted overseas (Capital One cards are Visa or MC).
5. Change your card to a different type or rewards program
Do you have a Citi Platinum Select card and you would instead prefer to have a Citi Professional card? Just call up and ask; they’ll probably honor your request. If they don’t, just ask to cancel the card and retentions will probably do it for you. This will only work if they’re the same class of cards, so if you want to change from a Citi mtvU card (student) to a CitiBusiness card (business), that will probably be impossible (but still worth asking). They figure that you can always cancel and apply for the new card anyway so they might as well reduce their overhead by just shifting it over for you. It’s all about lowering costs for them and retaining the customer, converting cards is hardly a chore.
6. Most cards double manufacturer’s warranty
Most credit cards will cover purchases on that card to double the original manufacturer’s warranty, up to an additional year. This comes at absolutely no cost and it’s offered because most people never take advantage of it. Part of the reason is that you often forget this is something that is even offered in the first place (because most people think of manufacturer’s warranty first and then straight to repair or replace) and the credit cards only mention this when you’re buying. 
7. Most cards offer auto rental liability insurance
This particular “secret” has been documented quite a bit lately, the fact that many credit cards offer some form of rental car insurance (collision and loss) if you use that card to pay for the rental. What it doesn’t cover your personal auto insurance may also cover so between the two you often don’t even need the insurance (really it’s a waiver) from the rental company in the first place. Some cards, such as American Express, have programs where you can pay extra to have additional coverage.
(Photo by mike hipple)
