10 Little-Known Credit Card Perks
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Your relationship with your credit card provider may seem pretty cut-and-dried. But your credit cards may offer hidden benefits and secret perks that you may not be aware of, which go well beyond frequent flyer miles. Some special offers are listed in the fine print of your credit card agreement, but many others aren’t public knowledge at all. These special offers are only available to customers who know exactly what to ask for and how to negotiate.
From avoiding fees to scoring free hotel stays, here are 10 secret or little-known perks that you may be able to score from your credit card provider.
1. Get an immediate credit limit increase. Though credit providers are less likely to increase your credit limit in the current economic climate than in days past, you can still negotiate a higher balance under the proper conditions, says Ken Clark, a certified financial planner and author of The Complete Idiot’s Guide to Getting Out of Debt.
“The biggest trick is to ask for it in conjunction with a large purchase,” says Clark. If you can make the case that you want a balance increase because you want to make repairs on your home or you’re buying a new laptop, says Clark, your request is more likely to be approved than if you’re simply planning to use the card for everyday expenses. It’s also important to be a long-term customer in good standing. If you’ve skipped out on several payments in the past, the request is sure to be denied.
In addition to providing you with more credit to spend on large purchases, this can be a good strategy to instantly increase your credit score, too. “30% of your credit score comes from what is called the ‘utilization ratio,’” says Clark, which is “calculated by dividing your total outstanding balances by your total possible limits.” So, if the credit limit increase is substantial, “or if paired with paying down your existing balances, it can have a significant effect on your credit score (FICO) in a relatively short amount of time.”
2. Delay a payment. “If you’re having difficulty paying, skip a month,” says Sara Petty, vice president of The Members Group payment consulting firm. Times are tough for everyone these days, and sometimes it can be difficult to even make the minimum monthly payment on your credit card if you’ve just incurred a big expense. If you know in advance that you’re not going to be able to cover a monthly bill, call your credit card provider and ask for permission to delay payment until the following month. Assuming that you’re a customer in good standing without a history of late payments, your provider is likely to waive your late fee and continue to report a “current” payment status to credit bureaus until the following month when you can make the full payment. While it’s never ideal to miss a payment, you can reduce your risk of hurting your credit rating by being honest and open with your provider.
3. Waive your late fee. If you attempt to make an online payment that doesn’t go through, or you never receive an invoice from your credit card provider, you have a good excuse to request that the credit company remove the resulting late payment fee on your next statement. Simply call your provider and explain the circumstances, and the fee will likely be waived. Even if the error is your own fault, you may still be able to get the fee removed from your bill “if you’re a great consumer and haven’t missed a payment in a year or two,” says Clark—however, this request will probably only work once, so be careful about paying on time in the future.
4. Negotiate a lower interest rate. This one is easy, says Clark: “Simply call in with another offer in your hand, and negotiate with them for a better rate.” Be polite, and tell your credit card company that you’ve enjoyed using their service, but you’ve found a better value option. Your credit card provider doesn’t want to lose your business, so you can leverage another provider’s offer to reduce your interest rate significantly, matching or even beating the competitor’s offer.
5. Transfer credit card funds into your bank account. “Consumers who have excellent credit, assuming the bank has a zero percent interest balance transfer offer, can ask for blank balance transfer checks,” says Oren Milgram, CEO of StudentMarket.com, an online shopping and credit resource for college students. There is often a $50 to $75 fee associated with the transfer, but if you don’t have any major upcoming expenditures, depositing the credit in a high-interest online savings account, short-term CD, or Money Market mutual fund can be a way to earn interest on your credit card balance until you need to use the card again. However, be sure to repay the initial funds by the end of the grace period (typically six to twelve months), or you’ll face massive interest fees.
6. Get merchant surcharges for credit card transactions removed. With the exception of schools and government offices, it’s generally illegal for merchants to charge an additional fee for credit card users, regardless of the purchase price. When making your purchase, tell the store manager to waive the surcharge. If your credit card statement still shows an additional merchant fee, you can report the incident to your credit card company as a violation according to the instructions listed in their Merchant Abuse Policy, and the fee will be removed.
7. Double your warranty on new purchases. When you make an expensive purchase like a new computer or refrigerator, there’s no need to buy the extended warranty that you’ll be offered at the store. As long as you use a major credit card to make the purchase, “your provider will automatically match the warranty up to a year on new purchases,” says Clark.
8. Take advantage of your card’s free car rental insurance coverage. Many cards offer free protection against damage on rental cars, so call your card provider to find out if you’re eligible.
9. Get discounted stays or complimentary upgrades at hotels, discounted meals at restaurants across the United States, and other travel perks. Major credit card providers offer many little-known discounts and upgrades on food and travel expenses that are each worth hundreds of dollars. Pull out your original welcome packet, or log onto the card issuer’s Web site for specific deals and offers.
10. Some cards, including American Express Gold, provide Best Value Guarantee (BVG) protection on new purchases made with the card. If you see a print advertisement listing an eligible item for a lower price, send the company your receipt and a copy of the ad to receive a refund of up to $250 against your original purchase price.
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30 Comments so far
leave a commentSome of this information I already knew but there was quite a bit of helpful hints I didn’t. What a treasure trove of knowledge.
the only one that I didn’t quite understand (complete right brain, lefty here). was Transfer credit card funds into your bank account.
What is this telling me exactly??
They are saying that if your credit card offers a 0% interest balance transfer for some limited period of time – take that money, deposit it into an interest-bearing account for the duration of the 0% offer. When it is about to expire, pay off the card with the funds and you’ve made a few dollars of interest in the meantime. Just make sure you pay it off!
These are very good tips. You just reminded me I have to call my credit card company to request that increased credit limit. It’s true, there is no harm in asking for more, you just might get it!
good post and very practical advice. Watch out though as the credit card company recently jacked up the late fees:
http://www.wealthalchemist.com/Blog/2009/07/us-consumer-squeezed-credit-card-rates-hikes-balance-transfer-charges/
Just wanted to let you know. I called my cc company and asked for an increase in my credit limit PLUS a decrease in my interest rate. I got both!
So, if I call my CC company they will reduce interest rates? I’m definitely doing that!! Woot!
I recently had my LCD tv repaired. The tv was past the manufacturer’s 1 year warranty, but my credit card’s 1 year extended warranty covered the expensive ($900) repair without any hassle. Even if you can afford to pay for an item outright, it’s worth it to use the credit card just for the extended warranty coverage.
Hello, just wanted to add instead of transferring money and incurring a transfer fee, which are becoming outrageous these days, a smarter (although shadier) way is to purchase $1 coins directly from the US Mint using your credit card. You will be essentially getting money from your credit card, and getting rewards points to boot, no doubt. Your credit card company will undoubtedly catch on eventually, however. Feign ignorance.
Also, Capital One currently releases “Purchase Checks,” which are inconceivable in this economy. These are sent occasionally, and you can deposit them directly into your bank account if you want. No transfer fees, no interest, no nothing, they count as a purchase, hence the name. They are essentially free money, as long as you pay off your balance the next time it is due! Or, if you are smart, transfer that balance to another card with 0% APR for an introductory period and no transfer fee (although that is pretty much unheard of these days–except for Capital One, but that would of course defeat the purpose of the balance transfer). There is still a way to get free money these days
“the only one that I didn’t quite understand (complete right brain, lefty here). was Transfer credit card funds into your bank account.
What is this telling me exactly??”
This is telling you to basically “buy” some cash. You can “charge” $5000 (or however much your limit is up to) to buy $5000 worth of deposits to an account that will pay you interest. This is a terrible advice for the following reasons:
1. Most companies in this economy will not give you a zero % rate for you balance transfer if you are already a customer. (customers come first is a joke). Only new customers might get this promo rate for 6-12 months.
2. Even if you get 0%, some banks will let you have it only as transfer to pay off another credit card vs letting you have the cash by moving it to your checking account. Some banks will let you do the deposit to checking but not at zero %. It will be counted as a cash advance with rates of about 19% or more. Ask and confirm.
3. Most companies will not charge you the dream amount of $50 or $75 per balance transfer, but will charge you 3 to 4 percent of the amount. On 5k transfer you’ll pay $150 to $200 just for the privilege of doing this move and you will owe back the fee, plus the entire 5k, and plus any interest if you don’t pay back the 5k in time for promo to end.
4. So even if you did get this awesome zero rate transfer, where would you put it? If you put it in super high yield CD that nowadays earns 3%, don’t forget you’ll pay a 3rd of your returns in taxes so you’re basically earning only 2% on your money. You can get better returns by paying off other higher interest debts.
These are very good tips.
Is number 6 applicable in Canada?
Question about #6: does that apply to gas stations that have a higher gas price for customers paying with a credit card?
“Get merchant surcharges for credit card transactions removed.”
Note: This may not apply to transactions done in a foreign country. Some countries do allow the merchant to pass along these costs to the buyer.
Very timely advice. I just brought an Apple Mac Book Pro in for repairs one week shy of its two year anniversary. Apple warranty is done. I called the company for the credit card I used to buy the computer and it turns out this is covered for an additional year. There is a complicated claim process that I am going through, but I have all the documentation and I’ll see if this works. Thanks.
JHKS and Caroline: Currently, Canadian merchants cannot surcharge or discount based on different payment methods.
http://www.cfib.ca/legis/national/pdf/6422.pdf
Caroline, have you come across gas stations that do this? I know that a country-wide hardware and general goods store offers a cash bonus if you do not use credit.
The Gas station down the street from me charges 3 to 5 cents more if paying with credit card versus cash.
This article reads like it was written before the economic meltdown. These days all I ready about are how CC companies are reducing credit limits and closing inactive accounts.
On some specific items:
- Double your warranty on new purchases. — I spent a lot of time looking for a card that has this. Don’t blindly assume your card does. Most do not.
- Some cards, including American Express Gold, provide Best Value Guarantee (BVG)… — This is likely the only card that still provides BVG. This perk is drying up faster than anything.
Yeah, it would be nice if #6 works in Europe. I’m military living in Germany and on some weekends I’m either forced use a credit card or I’d have to carry 2-3 different currency. I’ll have to look into it.
thank you! I really liked this post!
#10 is out of date. AmEx discontinued the Best Value Guarantee program a couple years ago.
Link for the previous post:
https://www124.americanexpress.com/cards/benefits/bestvalue_popup.html
#5? That is some of the worst advise possible. Write yourself a check from a zero-interest credit card to invest? That’s the same thing to helped tank the real estate market…short term memory??
Do your financial life a favor. Cancel all your credit cards (or don’t get one in the first place) and use your bank linked debit card to make purchases. Many banks even have reward debit cards.
# 1 and # 2 are also terrible ideas. Increase your credit limit? Why, so you can get in more debt and become the slave of the financial industry? Don’t spend more than you make.
Here’s a better idea: Put money aside every month into one of the Mint recommended online savings or brokerage accounts.
The secret of the rich is simple: Don’t carry debt!
um, maybe you missed the part where they explained that having a higher limit is good for your score? And the part where they explained that ‘no credit is bad credit’?
Having a high limit doesn’t mean we’re all going to go use it.
#5 is an excellent idea actually, as long as you earn more interest than you owe to the credit card. Right now i think its impossible to do, as CDs and savings account arent yeilding more than 2% (that i know of), while credit card advance fees are 3-5% per transaction. I agree with lulu.
An important rule about #6 is that retailers cannot charge a credit card surcharge, but they can provide a cash discount, effectively charging a higher price for credit cards.
Other perks:
-Delayed/Lost Baggage insurance
-Purchase protection – If it’s stolen damaged within 90 days, it’s covered
-Return protection – if retailer won’t take it back within 90 days, the credit card company will cover the purchase
-Travel insurance
-Emergency cash. If your wallet gets stolen
My Visa signature card has a concierge service. I never knew what that was until an agent at a mall kiosk asked me if I’d ever used it. It’s an 800 I can call any time and a Visa concierge is there to help me find things and places. They call ahead to restaurants to make reservations, help me find businesses, look up numbers etc. I’ve even had them figure out where I am when I’m lost. If you have a signature card add that number to your speed dial and stop racking up 411 charges on your cell phone.
Credit Card negotiations for Increases in limits and or decreases in rates…do these require your credit to be ran again??/
#4 is my favorite as it has been my biggest money saver. Negotiating interest rates for the life of the card became the difference between hopelessness and hopefulness for me. You have to be careful with this one though, as well as the raise your credit limit, because they might do a credit check on you which lowers your score, so ask them first.
#6 Is very bad for small, local businesses. Just eat the 25 cent surcharge at places that try to charge it if you are using your card at small places.
Here’s why: My friend works at a bakery and people try to pay with credit cards for $2 purchases but since it is illegal for the bakery to charge the surcharge, the bakery ens up LOSING money on the sale because the profit margin on something that small is about 25 cents which is about the same fees that credit card companies charge businesses for each transaction. The bakery has tried to charge a surcharge on credit card transactions but have been threatened with thousands of dollars of fines by the credit card companies. People need to understand the hold that credit card companies have on small businesses and that there’s a reason small businesses don’t want you to use credit cards.