Convenience Checks – Approach with Caution
How would you prefer to receive a clean check in the email to be used at your disposal for whatever you would like? Well, if you’re a credit cardholder, it is likely that you’ve already obtained such a check at the same time or another from your credit card company. That sexy slide of paper (or heaps of slips of paper) you’ve probably gotten in the email is called a convenience check, and although it may be tempting to use it in order to cover off one of your bills, it’s important to understand that they are often not nearly as suitable as their name may suggest. In fact, the term is outright misleading, as the use of convenience checks usually carries significant costs and hidden fees which make them far riskier than they are rewarding.
So What’s a Convenience Check, and Why Should I Avoid Using It?
A convenience check is an supposedly free, typically unsolicited check mailed to cardholders, often attached with a letter from the card issuer saying that the check may be used to”repay other debts” or”consolidate your outstanding credit card accounts.” The check functions as a kind of cash advance on your credit card, allowing you to borrow money straight from your credit 소액결제 현금화 방법. These days, cardholders get these checks within mere weeks of opening a account, and they are also common to see in mailboxes near holiday shopping seasons. Though they may seem to be ordinary, dependable checks which may help out when cash is tight, but the truth is that using these checks will probably further complicate one’s financial problems instead of help them.
Probably the very decidedly inconvenient feature of a convenience check is the lack of a grace period for cash advances on a credit card, meaning that the check starts to pay interest on the balance immediately from the time it’s drawn. It also doesn’t help that they qualify for the highest interest rate applied to cash advances, which makes them a great deal more expensive to use than somebody may originally think. Interest rates can hover around 20 percent or more. On top of this, many issuers charge exorbitant fees just to issue the check; those fees can often vary from 2% to 5% of the total check amount. It’s also not unusual for agreements to stipulate which cardholders have to be responsible for the total amount of the check, unlike the $50 liability limit on a stolen or unlawful use of a credit card. Whereas with a credit card, stolen or damaged items may often be replaced, convenience checks provide small to none of the identical purchase protection.
Little by little, these costs add up to an unsolicited mess which seems designed to deceive and frustrate consumers. Very little that involves using convenience checks is notably convenient, since the issuer will often review a cardholder’s credit history as soon as he or she tries to utilize a check. If the business determines that the cardholder is using an excessive amount of credit for buys, it may diminish authorization to utilize the convenience check, placing the consumer in a difficult financial situation. Consumers’ credit card statements are also often attached with convenience checks from the email, which makes them easy targets for thieves. In case the issuer takes the consumer’s use of the check and the check will not get stolen from your unlocked mailbox, then you will only have the above interest and fees to worry about. Obviously, you should attempt and avoid using convenience checks entirely. If you’re in need of quick cash, it’s significantly less risky to contemplate taking out a payday advance.