There are tons of excellent credit cards offers in circulation these days, many of them offering tempting enticements such as low interest teaser rates, new account rewards bonuses and automatic account upgrades. It’s important to realize that almost all of these offerings come with a caveat – the choicest accounts, APR’s and rewards programs are still going to go to the most credit worthy consumers out there. You may be lured in by a mailer advertising 0% interest for 12 months on transferred balances, but the reality is that you may not be eligible for it, depending upon your personal credit history and financial situation.
But you should know that credit card companies aren’t above dressing up certain services they are legally obliged to provide to cardholders in the hopes of presenting them to prospective new account applicants in the guise of a perk. Keep an eye out for the following things that your lender may want you to believe are magnanimous offers on their part, but are in reality your federally-mandates rights.
No Co-Signer Needed
This is something you will encounter over and over again in the college credit card arena. Credit card companies would like first time applicants to think the issuer is doing them a big favor by not requiring them to have a parent or other adult co-sign the account for them in order to guarantee the debt and allowing them the opportunity to qualify for a card all on their own. However, thanks to the Credit CARD Act, the eligibility of any applicant to carry a credit card – student or otherwise – will be determined by their own individual income. If a student can prove they have sufficient personal income to cover charges made to the card, then they can apply on their own. Likewise, the credit limit on the account will be determined by the applicant’s income. So anyone is able to apply to open up their own credit card account without a co-signer, but only those with an income will be approved.
No Consumer Liability for Any Unauthorized Purchases
If a credit card company makes the promise that they will cover any unauthorized charges made to your account in the case of fraud, you should realize that your liability is already very limited regardless. Because of something called the Truth in Lending Act that was put into place in 1968, a cardholder’s liability for any unauthorized purchases charged to their account is $50 and they cannot be held responsible for any charges that occur after the card has been reported as lost or stolen. So if a credit card company is trying to woo you with zero liability for any unauthorized purchases, while nice, it’s not really that big of a perk.
Look for credit card offers that are really extending you something that is worth being excited about. If used responsibly, a credit card with an fantastic introductory teaser rate or a big sign on reward point bonus can be worth taking advantage of.