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Credit Card Designed To Take You Over The Limit

By
Real Estate Agent with 410-935-5844 Office 634480

Credit Card Designed To Take You Over The Limit

I recently obtained a credit card from Discover Card.

When I applied for the card, I do not believe that they asked about my income.

They promptly approved me and gave me a $500 credit limit.

After two months, I asked to have the credit limit increased.  I was not looking to spend money that I did not have, but if I solely used this card for just groceries and gas, it was quite possible to go over the $500 limit.  My only concern was that I would not go over the credit limit, whereby I would end up paying some ridiculous interest rate like 25% or more.  I would pay the full balance at the end of the month.  They told me that I did not have a long enough history to increase the credit limit.

 I set it up so that I would have an automatic payment from my bank account.  My payment is scheduled for the second day of each month.  However, it does not pay the amount of my balance at that time, but rather it pays the balance that was due on the date about 2 days after my last payment.  This is good in that the money stays in my pocket longer, but it is bad in that after I make a payment, I do not start over with a zero balance, but instead, I start with close to a month's worth of expenditures, which means that I am that much closer to my credit limit.

I check all of my accounts almost everyday to make sure that no unknown charges are popping up on my account.  Quite a few of my charges are for gas, however, instead of showing the actual amount of my purchase, they use a placeholder.  If I spend $1, or $5, or $30, it does not matter, it shows up on my account as a placeholder value of $1.  This value may stay there for 3 days before the correct amount replaces the placeholder amount.  The problem is that they calculate my remaining available credit based on the placeholder value of $1 and not on the actual amount.  So it indicates that I have more credit available than I actually have available.

Each one of these three conditions increases the chance that I will go over my credit limit.

Too bad, Discover Card, you are not going to make money off of me.

 

Karen Krzniak
Zenith Realty - Towson, MD

Ron,

Of course, that is how they make money and it is why their profits are in the billions.

Feb 12, 2024 02:18 PM
Kathryn Sparks
Zenith Realty - Baltimore, MD

Ron,

It is a screwed up economy when one of its major products is money itself.

Feb 12, 2024 02:20 PM