Credit Card Convenience Checks

There are times when you cannot but help withdrawing emergency cash from your credit card.

However, when there is no ATM in sight, credit card convenience checks may just be the answer to your problem. What exactly are credit card convenience checks? How do they affect your monthly statement?

Credit card convenience checks are checks that are sent by credit card companies through mail (for free, of course) to encourage cardholders like you to make balance transfers, get extra cash from your amount, or make extra purchases. They usually arrive in groups of three or four, ready for you to issue and sign. They may prove to be convenient cash during an emergency but are really more of a debt trap than credit card companies let you know.

How inconvenient are credit card convenient checks, really? First, they carry hefty transaction fees that can be as much as 5% of the amount you write in them. Second, the interest rates bound to them fall on the same level as cash advances, often without grace periods. Third, they have default rates that can (at worst) double the rate that you are paying every month. This is a lot of burden for a piece of paper.

However, the deeper danger lies in the lax security that credit card companies are giving for these credit card convenience checks. Why? The only thing required from you to issue credit card convenience checks is your signature, which is not even verified by companies who receive them.

Red flag number 1: Credit card convenience checks are sent by snail mail. Any stranger can just come and take them from your doorstep or mailbox and start using them for purchases, to open bank accounts, etc. Since the security and fraud protections given to these credit card convenience checks are subpar, they can just get away with adding to your credit card transactions without your knowledge. You’ll just be surprised to see your monthly statement brimming with transactions that you are not guilty of.

Red flag number 2: Some cardholders who know about their lofty fees just throw them in the trash bin. This is not a good idea for anyone who wishes to steer clear from the effects of credit card convenience checks. A lot of thieves often dig thru people’s trash just to look for anything they can use. A lot of cases had been filed about these and the liability of the credit cardholder in these situations may be graver than when a credit card gets stolen.

So, is there a way to stop all these? Yes! What you need to do when you receive credit card convenience checks is to call your credit card company and ask them to stop sending you these checks. If you’ve already received one and have no plans of using it, you can just burn the whole thing. At least, you’ll be spared from being tempted.


Source: Credit Cards For People With Bad Credit Rating

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