Convenience really costs money

When you get home, check your mail, then lower your pen and see your credit card statement. The attached note has caught your attention. A convenient check is attached. It could be any amount like $300, $500 or even $1,000. The wheel of the head begins to rotate. You can use the money to do a lot of things. You will consider going fishing, changing some new equipment and even buying gifts for your wife.

Wow, you should stop there and think about the check you have in your hand. Remember, this is called a “convenience check”. In short, all of these checks are cash advances on credit cards. If you don't know anything about credit card cash advances, then you know that they usually bring a lot of extra costs, but unfortunately, consumers usually don't understand this.

I just want to show you a few fees that most credit card companies charge for credit card cash advances.

1. In addition to the normal interest charges, you usually have to pay 2-4% of the cash advance payment. So on the $1,000 convenience check, you will pay an extra $20-40

2. Other common situations in cash advances are higher interest rates. Even if you have a low-interest credit card, cash advances are usually charged at 18% or higher. Another point is that most credit card companies only use a small portion of your monthly payments for prepayments. Many companies require you to pay the purchase balance first and then pay a higher interest rate. If you only pay the minimum fee, it will take a long time for you to get a prepayment.

3. When you buy a product, it usually takes 30 days to pay off the purchased item before you start paying interest. This is usually not the case for cash advances. Usually, you will immediately start paying interest on any cash advances or convenience checks.

4. Your credit card company must disclose all the terms and conditions involved in the facilitation check, so you should be a consumer to read the rules. If you can't find any details on your statement anywhere, you should call your credit card company for any details.

Credit card companies charge these rates for two reasons. One is to deal with the costs associated with cash advances, and the second is to repay all outstanding loans. So yes, many times other people's mistakes are transferred to consumers.

I will never knock on a credit card company. They are engaged in business to make money. As an individual, you should decide for yourself. The card company will provide you with this check, but you definitely don't have to use it.

  Dale Mazurek

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