You’re probably not surprised that many advertisements tend to be a bit misleading on some level, and it’s little different in the world of credit cards.
More often than not, credit card issuers list out benefits that federal law requires them to provide, so as you begin to shop around for your next credit card, there are a few phrases to watch for that may seem like a good idea, but really don’t offer you any serious benefits.
Fraud Liability Protection
Many credit cards these days tout their zero dollar liability for unauthorized purchases, and with good reason. Identity theft and credit card theft are a very real concern in today’s society, but guess what? In 1968, Congress passed the Truth in Lending Act, and it already limits your liability for any purchases you didn’t authorize to a whopping fifty dollars. It even says that you can’t be held responsible for charges after you report your card lost or stolen. At worst, you’re going to have to pay a measly fifty bucks after your card has been stolen.
Several of those cards aimed at college students suggest there’s no co-signer required to qualify for their credit cards. The reality is that thanks to the Credit CARD act, you can’t qualify for a card based on your household income without a cosigner. So, if a college kid has a job, they’ll qualify for the card based solely on their income alone, not that of heir cosigner.
Prepaid debit cards love to claim that there isn’t a credit check required for their cards, and this is a good line to lure in those folks who don’t normally qualify for credit cards. Because you’re literally leaving your own money in someone else’s hands, though, there’s no reason for a credit check. You’re not using a line of credit.
As you try to find the right credit card for you, make sure you don’t get taken in by the fake claims of goodwill on the part of credit card companies.