Amex, Discover To End Credit Card Over-Limit Fees

[SpartanDem]

Source: Huffington Post

NEW YORK — American Express and Discover customers will soon be free of fees for charging over their credit limits.

The two companies said separately Tuesday they will soon end the charges that have generated widespread criticism from consumers.

The moves come before credit card regulations set to take effect in February limit the way credit card issuers may charge such fees. Under the legislation signed by President Obama in May, consumers must agree to pay a fee before they can charge more than their credit limit, and card issuers must tell their customers how much those fees would be.

American Express currently assesses a $35 fee to most customers whose balances exceeded their credit card limits.


Read more: http://www.huffingtonpost.com/2009/08/12/amex-discover-to-end-cred_n_257309.html

[Puppyjive]

1. Read the small print

I got my AMEX statement the other day. They said they were eliminating the fee for going over your credit. They also said they were raising my APR. There wasn't a reason for it. They just decided to raise it. I've never been late on a payment and rarely have a balance. They get rid of one fee and make up for it elsewhere. Same thing for banks. The fees are ridiculus. I bet they will start charging fees for debit transactions and check writing soon. I went thru the drive thru at my bank the other day. I wrote a check for cash and gave them my ID. They returned the check and said I had to endorse the back. I about fell over.

[Dr.Phool]

2. I got the same notice.

Same situation, never late, never over limit, and sometimes carry a small balance. The only place I use it is at Costco. Or some place that I really don't like, because Amex has much higher vendors fees than anyone else.

[uppityperson]

4. I got the same letter. Am calling them to cancel once I get the miles they give

for opening an account.

[regnaD kciN]

8. IF you can...

If you carry a balance on your card, most issuers give you an "opt-out" notice when they raise your rates -- in the month or so before the rate hike takes place, you can notify them by registered letter that you are refusing the change to your interest rate. Your account will be closed, but you can at least pay off the remainder of your balance under the previous terms (and APR).

However, as far as I know, AmEx does not offer that option. If they raise your interest rate, you pay the new rate, period...no opt-out offered. Of course, if you have a zero balance, you can cancel your card but, if you have a zero balance, why should it matter to you what the APR is?

(P.S.: I'm assuming these are all referring to AmEx's credit cards like Optima; the standard AmEx charge card -- where you're supposed to pay off the balance every month -- shouldn't have an interest rate in the first place, although they do charge you a yearly "membership" fee instead.)

[uppityperson]

9. It carries an annual fee. I am playing airlines credit card/freq flyer miles games

got a round trip ticket to Europe from United already, now am working on another airline's one. Apply for credit card, use once, get miles, cancel before the yr is up and fee is applied. I think they hope people will continue to use them and just eat the fee but I'd rather not. For some odd reason I'm a great credit risk and can keep doing this.

[Snarkoleptic]

12. The scumbags at AMEX gave no such option...

We have an AMEX blue card that went form 9.99% to 13.99% a few months ago.
Last week we received notice that we're not being forced to accept a 15.9% adjustable rate (can't opt out by halting future purchase or kissing the bishop).

Future posters to this thread can spare me the 'we don't carry a balance and you shouldn't either' horseshit. We got into trouble with these loansharks when my MIL developed a level 4 glioblastoma (brain tumor) and required $8K per month in care at a facility with skilled nurses looking after her following surgery for the 95+% fatal brain tumor. Later on, my wife developed skin cancer and quelle surprise...it was considered a pre-existing condition and was not covered by our insurance parasite.

[TwixVoy]

6. Ummm

You ALWAYS have to endorse the back of your check REGARDLESS of who it is made out to. It has been that way for 50 years. How old are you?

[unblock]

10. some local banks and lazy tellers don't insist on it. it's not a legal requirement.

if the check is made out to cash, it's a bearer instrument, valid for anyone to use. good banking practice is to require an endorsement on the back, but it's not legally required.

banks do have every right to insist on one, though, so no point in complaining about it.

[GodlessBiker]

3. They could easily disallow the charge which goes over the limit.

But, instead, they permit the charge and make you pay an extra fee.

[Purveyor]

5. I have a Capital One business Visa and they sent me a letter offering to set my account

so that no authorizations would be given if that amount would put me over my credit limit regardless how small.

Of course I excepted but had to call them to request that status.

[alstephenson]

7. I got the same letter from AMEX.

Said no over limit fee BUT they are raising my APR (doesn't say to what). I've been a customer since 1994.

[Joe Bacon]

11. I cancelled my Amex too

Lately I've been using it at Costco, but now I will just pay cash instead. I was able to consolidate my debt with a Union Plus credit card that allows me to skip a month if other expenses get in the way and it has a lower interest rate.

[regnaD kciN]

13. Once again, the moment I knew that "credit card reform" was a joke...

...was when they gave the banks until next February to put the new rules into effect. Anyone could have seen the banks and finance companies would do what they have, in fact, done: use those nine months to jack up interest rates and restructure agreements so that, when the new rules take effect, they will have no beneficial effect on current cardholders, as "facts on the ground" (which the reform bill can't roll back), will have set up a long-term situation that will be exactly as Big Finance would have arranged things had there been no reform at all. :-(