Four Reasons to Avoid Store Credit Cards

yahoo ^ | December 6, 2005 | David Bach

[kidd]

"I've signed up for the card to get the discount. Then paid in full, and then immediately cut up the card."

Me also.

[Eagles Talon IV]

Yes, of course. I neglected to put that in the post but it is in fact something I do.

[ArrogantBustard]

Those are legitimate objections.

[maxter]

Good for you. We have no credit card debt, however we are in the market for a car, an over $20,000 ticket item. We have waited longer than we should have to buy. Looking at an 06 Nissan Titan. Any reviews out there? If we wait much longer, we will have to walk, probably good exercise though..

[JoeGar]

If you pay your credit cards bills in full, the cards are a good deal. I usually get an additional 15 percent discount off of sale prices by using the store card.

[Mamzelle]

Like any gal, I like a discount, but I turn these offers down these days. I had the most ghastly experience with a Brand X credit card--...

I got a call at 7:00 AM one SATURDAY morning notifying me that I was about to be reported to a credit collection company. I was groggy, and while I didn't think I had missed a payment (I pay everything in full when I get the bill), I agreed to let them take my payment (about $200) out of my checking account. Okay, I was half asleep. I had to also fork over some charges, about $20.

The incident disturbed me, but I had remembered buying a couple of outfits the previous month. The next bill came in the mail--I had a credit balance for the $200--plus the record showed I had paid within the proper time.

I spent the next couple of hours growling my way up the ladder of management at Brand X--and I got my $20 back, cancelled the card, in addition to yelling at a few yuppies for waking me up on a rare Saturday off.

It occurred to me later that a lot of people might not have bothered--and that Brand X was making a nice bundle (in volume) on those $20 charges.

Let 'em keep their discounts--

[AlaskaErik]

I've signed up for the card to get the discount. Then paid in full, and then immediately cut up the card.

But you're still hurting your credit score.

[Mamzelle]

I have heard (disclaimer) that whenever you apply for credit it hurts your rating a little bit--because you have more debt potential.

[dfwgator]

If you have good credit already, it really doesn't matter that much. If you are a borderline case, I could see it being an issue. In that case you will have to notify the bureaus that you've cancelled the card.

[hschliemann]

...and then immediately cut up the card.

I hope that by "immediately",you mean immediately,that is,right there at the register as you take your receipt.

[hschliemann]

What happened to self control?

I recently went into one of my favorite stores (a large national clothing chain) looking for a grey sweater...I said no and explained that I was looking for a small grey sweater..."Well, no. I'm looking for a small grey sweater." When I went to pay for some socks and pants...!!!

The problem is obvious.

[MeanWestTexan]

I've signed up under a my name with bogus DOB/SSN and the address of the Midland YMCA, paid cash for the purchase when the application was declined.

Saves the problem of cancelling the card.

[Cobra64]

Amex is the plastic in my wallet. I'm up to almost 200,000 points because I put everything on The Card. If a store does not accept Amex, I pay cash.

As for the actual shopping experience; I use the internet since I can't stand malls and usually there are no sales TAXES.

[Cobra64]

I usually do that too. But apparently your financial rating is adversely affected by merely opening the account.

Go to your bank and have them look up your FICO rating. Some may be surprised. I had a Gulf card 12 years ago for convenience; went to Europe for three months, didn't pay the bill, and it was STILL an open item. Every time someone opens up an account, it has an impact with one's credit rating.

[Cobra64]

But you're still hurting your credit score.

Bingo! Too many people do not understand that. Mine is close to 800. And, because of that, we got a much better mortgage rate when we built our new house two years ago. Then, we pay our mortgage on an automatic (transfer) semi-monthly basis... mortgage will be paid off in 12 years.

[newcthem]

A word of warning......watch for the Sears CitiBank Visa, in my case I thought I had it paid off, using it only for a discount purchase. I stopped getting monthly bills for 6 months, then got a notice that I had an annual fee, late charges and penalties and the rate was up to 30%. I asked where the bills had been going....no response. I paid off the card, closed the account and will not get within 50 feet of a f---ing Sears store if my life depended on it.

[R. Scott]

I’ve been approached several times in the last couple weeks and asked if I want a store card. I reply, “What? You don’t take VISA?”

[Mamzelle]

Citibank--see my post about Brand X...

[conservative cat]

I don't do credit cards AT ALL but unfortunately have a car payment in addition to the mortgage. I went two years without a car payment and it made me very very sad.

[F16Fighter]

"Senator Charles Schumer of New York is also concerned about department store credit cards. In a recently released report, he explains why these cards are a lousy deal for consumers."

The "lousy deal" is pretentious traitorous New York Senators pretending to be looking out for the little guy's pocket book on one hand while taxing him into financial oblivion with the other.

What a phony creep.