Credit-Card Companies Deal More Blows to Customers
Credit-card issuers are scrambling to change terms and hike fees before a few provisions of a new credit-card law take effect August 20. So you need to carefully read any letters you receive from your card issuer. American Express cardholders especially should read all the fine print now because this issuer is making lots of changes.
American Express just notified customers that it is raising the cash-advance fee from 21.24% to 25.24 after October 1, says Bill Hardekopf, chief executive of LowCards.com and author of The Credit Card Guidebook. Starting in September, the card issuer will also cancel points that American Express Blue and Blue Sky cardholders earn in months they have a late fee. You won't be able to redeem points until your account is in good standing -- then you'll have to pay $29 for EACH month's points you want to redeem. Ouch!
"This opens a door to adding new fees to the reward program and holding reward points hostage," Hardekopf says. "If this works, others could follow."
One thing AmEx cardholders can look forward to, though, is the elimination of over-the-limit fees starting in October. Discover also will drop this fee soon.
Not happy with the changes your card issuer is making? You might find better terms elsewhere if you have good credit. See the New Rules of Credit Cards for tips on dealing with rate hikes and changes in terms and for a list of our favorite cards.