Unsecured Credit Cards - Never Again

[wlonsdale]

How to use a debit card......

When I use my debt card as a visa and sign my name it becomes a credit card with all the benifets of one. But it just takes the money right out of my checking account. I really don't want to get a credit card any time soon. I will never again pay % or late fees. Dave Ramsey is right, when it comes to money. DEBT IS DUMB.

I agree, debt is dumb...that's why you pay your credit card off monthly. For those who think a debit card is the equivalent of a credit card, safety-wise please read this http://www.pirg.org/consumer/banks/d...ebitcards1.htm[email protected];
Fax - Faxing to - 1-713-336-4301 or; Sending mail to -
Customer Assistance Group
1301 McKinney Street
Suite 3710
Houston, TX 77010


-- Debit cards may offer some convenience. But debit cards have more risks than PIN-based ATM cards. Since the risk of credit card fraud on the Internet is so high, we urge consumers to ONLY use credit cards on the Internet-- never use debit cards. In addition to this greater legal liability protection with a credit card, you have greater legal protection if goods are defective or don't arrive, under the Fair Credit Billing Act, which applies to credit cards.

-- Debit cards make banks a lot of money. When you use the card like a credit card (with a signature, but not with a PIN), banks take a hefty fee from the merchant. When you use it with a PIN, like an ATM card, more and more banks are charging you a transaction fee (called a POS fee) of $0.25-$1. Other banks are charging a monthly card rental fee (even if you do not use it at all) of $1-2/month. That adds up to $12-24/year, plus transaction fees. Of course, banks are hitting you with a POs fee in hopes you use the card with a signature-- so they can make more money from the merchant.

-- "Blocking" is also a problem with debit cards. Some firms (hotels, gas stations and rent-a-car companies) routinely block a card in advance for the estimated cost of a transaction that may not be completed for several days. It isn't a problem for most credit card customers, unless they are near their account limits. But if you buy ten dollars worth of gas with your debit card, you may not know that the station may routinely block all transactions for $50-75, then doesn't "un-block" as you drive away -- it waits until that evening, or worse, every few days to conduct a "batch" transaction. If you are close to your checking account limit -- much more common than being close to a credit card limit -- you could end up bouncing checks or be refused transactions by other merchants due to faulty blocks. Most banks do a poor job of informing consumers that they may bounce transactions due to overdrafts created by blocks. Of course, virtually no gas station explains their blocking policy, which presumes everyone drives an RV or tractor trailer truck, and is filling it up.

-- Finally, most banks don't ask for consumer consent. When ATM cards expire, they replace them with risky debit cards. And, we are unaware of any bank that adequately explains the risks of debit cards.

WHAT CAN CONSUMERS DO TO LOWER DEBIT CARD RISK?

(1) If you don't want a debit card, demand a plain old ATM card.

(2) If you do want the convenience of a debit card, lower the risks:

-- Never use a risky debit card on the Internet. Only use a credit card for Internet transactions. In addition to greater legal liability protection with a credit card, you have greater legal protection if goods are defective or don't arrive.

-- Use a debit card only with merchants you trust. It is also a good idea never to let it leave your sight-- it's one thing to watch a clerk "swipe" it right in front of you at the cash register and hand it back to you. It's another story when you hand it off to a potentially unscrupulous waiter or waitress who could have an illegal card "skimmer" (the size of a pack of cards) in their pocket and copy your information after they walk away with it.

-- Just as you wouldn't use it on the Internet, don't use it to call info-mercial 800#s off the television. If you have a dispute over double-billing or products that don't arrive from a sleazy info-merchant, remember-- you'll be fighting to get your own money back, and that could take ten days or more of arguing with your bank.

(3) Complain to Congress! Urge Congress to enact legislation to change the Electronic Funds Transfer Act law so that debit card liability is legally the same as credit card liability. Not surprisingly, the banks oppose it. No matter what card you use, you should be equally protected.

(4) Send comments of any complaints about unfair treatment by your bank of your debit card dispute to [email protected].

[outofdebt201]

When I use my debt card as a visa and sign my name it becomes a credit card with all the benifets of one. But it just takes the money right out of my checking account. I really don't want to get a credit card any time soon. I will never again pay % or late fees. Dave Ramsey is right, when it comes to money. DEBT IS DUMB.

[TEW]

I used my paypal debit card to buy plane tickets a few weeks ago. There are ways around everything.

I feel I've had such a bad experience I don't want to give them business.

I'm with you penny I never used CC's and never had a hard time doing things. I guess I am going to buck the system and pay cash or do with out.

[No Gravy]

Would you tell an alcoholic that wine is necessary, that they just need to learn to drink in moderation? Some people just cannot have access to credit, just as some people cannot drink a single drop of alcohol

SOME people, certainly not ALL. I think it's an outlandish example to compare the two.

Other individuals make different choices, but criticizing those that decide to abstain trying to scare them into thinking they can never travel, etc., is unhelpful.

WHOA. Right there, back that bus up.

I see no one criticizing anyone's choice. Because I pointed out a couple of areas to watch for, that's criticizing? I'd say you need to adjust your comfort meters.

I have been in my CH 13 for a year now. In May flew to Kansas, rented a car, got a hotel room, all with cash. Two weeks ago went to the east coast for 9 days for work, again, used no credit cards. Those who think it is impossible maybe aren't really trying to work around it.

Now who's "criticizing" who? If we all don't live and handle credit exactly as you have chosen to do, we're wrong?

Thanks so much for sharing your opinion, it's been ever so enlightening.

[woeisme]

Would you tell an alcoholic that wine is necessary, that they just need to learn to drink in moderation? Some people just cannot have access to credit, just as some people cannot drink a single drop of alcohol, and if they are self-aware of this and choose that they would rather have the inconviences that go along with no credit cards, I totally support that choice. Other individuals make different choices, but criticizing those that decide to abstain trying to scare them into thinking they can never travel, etc., is unhelpful. I have been in my CH 13 for a year now. In May flew to Kansas, rented a car, got a hotel room, all with cash. Two weeks ago went to the east coast for 9 days for work, again, used no credit cards. Those who think it is impossible maybe aren't really trying to work around it.

[No Gravy]

Using debit cards for online purchases can be dangerous, whereas with a credit card you're afforded a measure of protection. If your account number is found and used fraudulently with a CC you can dispute the charge and not owe that amount.

Though most banks offer some level of fraud protection, once the money' gone it's gone, and then you have to get the bank to put it back into your account.

There are electronic security breaches happening daily, and debit cards don't offer anywhere near the consumer protection of credit cards: http://www.privacyrights.org/fs/fs32-paperplastic.htm

[AngelinaCat]

I will add to this in that do NOT write checks either, expecting that the 'float' will cover them. I've noticed that we have gotten into that habit and have racked up several $30.00 NSF charges because we were depending on the deposit to come in a day or two. NOT GOOD!

[AngelinaCatHub]

but thats just it. Credit cards are completly unneccesary. Without the cards you can easily have enough in your checking account that your debit card is attached to cover car rentals or hotel rooms or airline tickets up front without usung any credit cards. If your work does not provide you enough income to make this true then perhaps a job where all that travelling is not required is in order. Credit is completly unnecesarry, Rent until you can afford to buy or get the Mortgage from the Underwriter directly. That will keep it to a reasonable part of your income. A mortgage should be the only thing any of us borrow money for. If we all teach our kids this from the start they will lead much less stressfull lifes I think. Just my opinion. Not worth much but I am gonna file and get rid of my cards and my truck will either go back or be paid off next May. Tehn all thats left is a very cheap mortgage and that will be paid as soon as possible. Not meaning to offend anyone, but credit cards and for the most part credit in general is never a good idea.

Rob

Clap, Clap, Clap!!! and the post below too. Yes it is a habit. When you do not see green leaving your hand, you do not equate the expense involved. I disagree that they are preditory, with a caveat. They do not want you to bk as they lose. They want you to use THEIR card ergo the big special deals. After bk you will get many junk credit offers. The weak will bellie up and the circle starts again. I shall never have a CC card, again. One debit card for emergencies. BTW it is a very good idea to have a $100.00 bill folded small and hid in your wallet and FORGET IT. Ms. Cat and I took a wrong turn once and in FL in the Ocala forest we hit a road of sugar sand and the car stopped going forward and went down to the chassis. We called 911 on a phone not is service (by law 911 will always work) and got a tow truck out. When I gave him a credit card, he said cash. When I showed him a check, he said cash. Fortunatly we had fifty bucks. I bargained that here is fifty here is a check for 50 cash. He accepted this but he would have left us if we did not compromise. It was a scary lesson. Cash talks Credit walks. 'Hub

[$$only4ever]

I, too will never have another credit card again. The last time that I used a credit card was in December 2004. Don't miss it, don't miss the games that banks play and certainly don't miss the monthly bills. And when I complete my payments and get discharged, I will finally get this credit card monkey off my back for good. And I can promise everyone, I won't miss being in bankruptcy neither.

[ras1974sib]

unsecured credit cards

but thats just it. Credit cards are completly unneccesary. Without the cards you can easily have enough in your checking account that your debit card is attached to cover car rentals or hotel rooms or airline tickets up front without usung any credit cards. If your work does not provide you enough income to make this true then perhaps a job where all that travelling is not required is in order. Credit is completly unnecesarry, Rent until you can afford to buy or get the Mortgage from the Underwriter directly. That will keep it to a reasonable part of your income. A mortgage should be the only thing any of us borrow money for. If we all teach our kids this from the start they will lead much less stressfull lifes I think. Just my opinion. Not worth much but I am gonna file and get rid of my cards and my truck will either go back or be paid off next May. Tehn all thats left is a very cheap mortgage and that will be paid as soon as possible. Not meaning to offend anyone, but credit cards and for the most part credit in general is never a good idea.

Rob

[goingout]

I do think the credit card companies are to blame at least in part. They encourage irresponsible borrowing. I do believe them to be predatory.

[Flamingo]

2 months 21 days and counting into my new years resolution...I am never never ever ever getting or using an unsecured credit card ever again.

How does it go...better to die on your feet then to live on your knees?

There is nothing wrong with unsecured credit cards; it's how they are used that leads to the problems...none of us were/are forced to sign for them or obtain them. If one travels on business or needs to rent cars or stay in hotels, one is definately needed unless it is provided by one's employer. But I admire your resolution and hope you stick with it.

[sisterfunkhaus]

I have used the Dave Ramsey plan to help me plan my financial needs. Works great and its free, unless you want to buy a book or attend and event.
regards,
emoney

We are reading his book now. We live with my parent and they actually want us to stay even after I go back to work. If we could manage that, we could pay off $120,000 in student loans in less than 5 years, pay off our current car, and be in amazing shape financially. Even after this five years if we got our own apartment, we could afford to save up a very large down payment on a house. With our student loans, car payments, a good rental history, and 20% down payment, I'm pretty sure we'd be just fine without a credit card. I like what he says about living like no one else will allow you to live like no one else.

[poor@budgeting]

With the advent of Debit Cards with VISA & MasterCard association, it is now easier to live without a 'normal' credit card or AMX charge.

But there are still downside in using just Debit cards, e.g.,
- Lodging charges puts a 'hold' in excess of your normal fee;hotel might charge the actual bill as seperate while the 'hold' clears a few days later - puts a strain on the checking account.
- Same for car rentals. Some won't even allow without CC, which could be actually the cheapest rate.


There are just too many advantages of having a CC/good credit. The trick is to learn from the mistakes that got all of here.

[jp2861]

This is just my opinion, but I think it's crazy not to use every tool available to rebuild credit. If the stress created by filing bankruptcy hasn't drawn the clue bird to land on ones shoulder, nothing will. Those folks will find a way to get back in financial trouble, credit cards or not.

As far as credit cards are concerned, nobody is saying you must have tens of thousands in available limits. Keeping it simple is the way to approach it. For me, $2,000 in available limit is fine. Maintaining the "live on cash" philosophy can still be the way to go, even using credit cards. Buy a tank of gas...next week pay it off. Buy your groceries...next week pay it off. If you come up with a system of paying for normal (key word being normal) cash expenses with a card, and then paying it, or 95%, shortly afterwards, it becomes very manageable. Especially with online bill payments and such. It's really just a matter of coming up with a system and sticking to it.

We can blame the banks all day, but until we discipline our habits nothing will ever change. So much of our daily lives revolves around credit these days that it's almost unrealistic to think we can get away without establishing a good history.