Charge Card vs Credit Card

[mickeyd]

I recall my first CC in the 70's as being a Charge card. Sometime along the way it became a Credit Card. I never really gave it much thought until recently when I ran across this. For those of us who do not carry a balance, I guess we still have a Charge Card that doubles as a Credit Card if necessary.

Charge card. A charge card doesn't allow for revolving balances, but it does let you borrow money for about 30 days. If you don't repay the balance in full by the due date, you'll get penalized and the account may be suspended. Most issuers impose at least a small annual fee, and some elite level products are very costly. For this reason, I believe the card American Express offered to you was actually a credit card, as the company offers both products. Charge cards can be worth their price because of their premium rewards programs and membership benefits. I like them because they provide the freedom to borrow quite a lot of money, but the short repayment term forces you to keep debt down.


Credit card. As you must know by now, a credit card does allow you to make minimum payments and roll the balance over to the next month. Of course, there are times when financing a product or service is smart, but by no means is it always a wise idea. When you carry over balances, interest charges are added, which increases the cost of your purchases. Cardholders must be extremely conscious of how much they charge and be committed to repaying the debt quickly. Because you've been such a responsible borrower, you are probably entitled to a credit card with no annual fee, but like the charge card, you should get one that is also equipped with great terms and benefits.

Charge card vs. credit card: What's the better choice?

 

[73ss454]

Never touch them, I use Debit only.

 

[meierlde]

Never touch them, I use Debit only.

Actually due to their longer standing existance there are better protections with credit cards than debit card (max $50 if lost etc).
Anyway what says you cant treat a credit card as a charge card and pay it off every month. That way you become the banks worst customer in one sense as they only get the merchant fee. (Of course not as bad as you were when it costs the banks 5% pa for the money a few years ago).

 

[73ss454]

It took me 58 years to get out of debt and I just have a thing about using credit, even if it's for a month. If I don't have the cash in my account I don't buy it. I don't even check my credit score as I don't plan needing any credit.

Just a thing with me, I know I'd do better with rebates and such but this is the way I roll.

 

[Gone4Good]

Actually due to their longer standing existance there are better protections with credit cards than debit card (max $50 if lost etc).

Yup. Add the fact that if someone uses my credit card number, they're stealing other people's money. If they get my debit card, they're stealing my money. Regardless of what "protections" are in place, I'm in a much better position if the CC is out a bunch of dough and looking to get reimbursed than if I'm out a bunch of money looking to get reimbursed.

I see no reason why I'd ever use a debit card.

 

[73ss454]

My debit card was hit 2 different times for almost 2K both times with bad charges. My bank handled it with no problem and the money was put back into my account. I don't know what bank you use with a $50 limit.

 

[mickj]

Fraud Protection: Debit Versus Credit Cards - Alpha Consumer (usnews.com)

Consumer liability for debit and credit card charges is limited to $50 when fraud is reported. However, VISA and MasterCard, which control 100 percent of the U.S. debit card market, have gone one step further, and require that credit card issuers like Capital One, Chase and Citibank adhere to a zero percent liability policy for their customers. They also require that immediate refunds be granted on disputed charges. Most major credit card networks have applied these rules as well.

The amount of protection offered by debit cards versus the level of protection offered by credit cards is identical, as mandated by the law and in common practice. But this is not to say that the level of protection matches the level of convenience. Both debit and credit cards offer zero percent liability, meaning that all consumers who find themselves victims of card fraud will end up in the same place–their money will be refunded. However, because of the way debit cards are structured relative to credit cards, unauthorized debit card use can have a huge impact on a consumer’s wallet and on his or her psyche.

 

[Rustward]

A little more detail from the FTC:
Credit, ATM and Debit Cards: What to do if They're Lost or Stolen

Credit Card Loss or Fraudulent Charges (FCBA). Your maximum liability under federal law for unauthorized use of your credit card is $50. If you report the loss before your credit cards are used, the FCBA says the card issuer cannot hold you responsible for any unauthorized charges. If a thief uses your cards before you report them missing, the most you will owe for unauthorized charges is $50 per card. Also, if the loss involves your credit card number, but not the card itself, you have no liability for unauthorized use.
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ATM or Debit Card Loss or Fraudulent Transfers (EFTA). Your liability under federal law for unauthorized use of your ATM or debit card depends on how quickly you report the loss. If you report an ATM or debit card missing before it's used without your permission, the EFTA says the card issuer cannot hold you responsible for any unauthorized transfers. If unauthorized use occurs before you report it, your liability under federal law depends on how quickly you report the loss.

For example, if you report the loss within two business days after you realize your card is missing, you will not be responsible for more than $50 for unauthorized use. However, if you don't report the loss within two business days after you discover the loss, you could lose up to $500 because of an unauthorized transfer. You also risk unlimited loss if you fail to report an unauthorized transfer within 60 days after your bank statement containing unauthorized use is mailed to you. That means you could lose all the money in your bank account and the unused portion of your line of credit established for overdrafts. However, for unauthorized transfers involving only your debit card number (not the loss of the card), you are liable only for transfers that occur after 60 days following the mailing of your bank statement containing the unauthorized use and before you report the loss.

If unauthorized transfers show up on your bank statement, report them to the card issuer as quickly as possible. Once you've reported the loss of your ATM or debit card, you cannot be held liable for additional unauthorized transfers that occur after that time.