[net.consumers] Free Credit Cards Are Not

ted@teldata.UUCP (Ted Becker) (04/06/84)

*********
All of the free credit card offers I have checked out require a minimum
balance of $500.00 or more in a checking account.  This becomes captive
money you cannot use and are not drawing interest.  If you were to put
that $500 in a savings account you would receive $27.50 per year in
interest out of which you could pay a $15.00 fee for the credit card
and still have enough left over for pizza and beer.

Debit cards defeat the advantage of free credit for 30 to 45 days on your
purchases.  When your monthly credit charges get up to $500.00+ this free
credit can increase you net earnings in a money market fund by $4.00 to $6.00
per month over what it might have been if you had kept the cash and spent
it right away.

rkp@drufl.UUCP (Pierce) (04/09/84)

I beg to differ that nothing comes free.  I currently have a
MasterCard from United Missouri Bank in Kansas City, MO, and do not
pay anything for an annual fee, nor do I have to keep any money in
any account anywhere.  I didn't even actively search for such a deal.
They sent me a half-page application in the mail, I had been turned
down before, so I decided to try again.  Voila--fish and chips!

The only drawback I see to their card is that the interest rate is
22%, but that is only 1% over the norm (I can handle that).

Russ Pierce
AT&T
Denver, CO
drufl!rkp

leung@imsvax.UUCP (04/10/84)

I have a free credit card on Union Trust S & L, MD.  Of course, they
require me to open at least a checking account with no interest.
But they have an option that if I also open a saving account
with $300 minimum balance, there is no minimum balance on the
checking account.  As such, my $300 is still earning interest.
I don't see why paying annual fee is a better choice.  The S & L
also guarantee that there will be no charge on the credit card
for at least 3 years.

----
Aldrin Leung
IMS, Inc. of MD
----

wmartin@brl-vgr.ARPA (Will Martin ) (04/10/84)

My credit union (Gateway Federal, St. Louis) offers free MasterCard
(only requirement is having $100 in your share [savings] account)
with an arrangement through some bank/organization in Florida, which
is where I send the payment. No fee, and no interest charges if you
pay in full each month, which is what I always have done, so the
interest rate is totally unimportant. Check with your local credit
unions; most people qualify for membership in several.

A local savings & loan is advertising free Visa and 16% interest,
no account requirements, but there is no free period if you pay in
full; you get charged interest from day of posting. I had intended
to get one of those as a backup, but detected that no-free-period
by reading between the lines on the application. It won't cost anything
if I never use it, so I still might get one for emergencies, but I
doubt it...

Keep your powder dry...

Will

rpw3@fortune.UUCP (04/14/84)

#R:teldata:-29800:fortune:39400008:000:566
fortune!rpw3    Apr 13 20:02:00 1984

Yes, the Schwab-One account requires a $500 minimum for their VISA
debit card, but you get money-market interest on that. What's the
problem? (You are also protected the same way that an earlier posting
about Merrill Lynch pointed out -- "Bank One" of Columbus, OH, reserves
the "right to extend you additional credit". So it's a "credit" card,
from the consumer protection point of view.)

Rob Warnock

UUCP:	{ihnp4,ucbvax!amd70,hpda,harpo,sri-unix,allegra}!fortune!rpw3
DDD:	(415)595-8444
USPS:	Fortune Systems Corp, 101 Twin Dolphin Drive, Redwood City, CA 94065

smk@axiom.UUCP (Steven M. Kramer) (04/18/84)

C'mon people.  The outfits that offer free credit cards make money
simply by having the use of your money for a period of time.  Usually,
there is some accompanying bank acct to go with it.  In addition, if
they feel you are a not-so-nice risk, they will require you keep the
amt of your credit limit in the bank.  Banks really aren't set up to
lose by us -- they only lose on S. America, Poland, ...
-- 
	--steve kramer
	{allegra,genrad,ihnp4,utzoo,philabs,uw-beaver}!linus!axiom!smk	(UUCP)
	linus!axiom!smk@mitre-bedford					(MIL)