Drive Your Credit Card Issuer Crazy With These 3 Tricks. They'll Hate You

Drive Your Credit Card Issuer Crazy With These 3 Tricks. They'll Hate You!

Last updated on August 26, 2018 Views: 1515 Comments: 6

Credit card companies are competing harder than ever for our credit card spend and balances. We’ve all seen the 0% promotional rates, 25,000 point sign-up bonuses, and annual fee waivers from time to time.

Do it right, and there’s tons of hidden value in ambitious credit card offerings. Do it wrong, and you could pay the price for a long time to come. The banks are counting on you making mistakes. In fact, their profit depends on it. Here are a few tricks that will allow you to milk credit card offers for all they’re worth and drive your bank absolutely crazy.

1. Churn, Baby, Churn!

Credit card issuers try to lure customers to new credit cards with big sign-up bonuses. In return for giving you a hefty welcome bonus, which can often times be worth $300 or more, they’re counting on you using the card and spending big for years to come.

Some cardholders have gotten wise and bounce from offer to offer, collecting the bonus points, using the points, then closing the account. Rinse wash repeat from card to card, issuer to issuer. This is a great strategy assuming you’re mindful of a few roadblocks banks have put in the way to prevent the behaviour.

First, some banks make you spend a minimum amount within a given time frame to be eligible to receive the welcome bonus. If a bank makes you spend $1,500 within the first three months to receive the bonus, make sure you can do it by shifting your card spend, without having to spend any more than you otherwise would have spent anyways.

Second, be mindful of the annual fee. If you’re getting a credit card with a $120 annual fee, and it’s only giving $150 in welcome bonus value, the $30 gain may not be worth the trouble. Wait until you find an annual fee waiver offer, or the welcome bonus is significantly greater than the annual fee. Some banks even waive the annual fee if you keep a minimum amount of money in your checking or savings account with them – see if you qualify.

Third, there is a limit to the number of credit cards you can apply for and cancel. Each time you do so, it negatively impacts your credit score for a short period of time. We recommend spreading out your applications (every 90 days or so) to avoid getting declined for “too many recent inquiries.” You don’t necessarily have to cancel your credit card, but you’ll want to do so if the card starts charging an annual fee in the second year, and you have no intention of using it at that point. Stay informed and start familiarizing yourself with which rewards credit cards you have an interest and when those cards typically offer their best deals. Compare credit card offers routinely to get the best deals available.

2. Pre-Authorized Debit for Your Credit Card

Did you know that even if you pay the credit card minimum payment you won’t be eligible for the grace period if you don’t your balnce in full? You’re not alone if you didn’t. Did you know that if you’re late for a credit card payment, you’ll not only lose your promotional rate, but you’ll be charged interest at the regular rate for the entire time period since you made your initial purchase?

If you want to take away any chance that you’ll ever pay interest on your credit card ever again, there’s a simple rule to follow and it’s full proof. Follow the bank beating Golden Rule: use pre-authorized debits to pay your credit card balance in full  on your payment due date. You’ll never be late, carry a balance or be charged interest.

Banks dislike pre-authroized payments on credit cards so much, some still require you to mail or fax the application in, trying to make it as cumbersome as possible.

3. Rate Surfing

If you’re not able to pay down your credit card balance we recommend one of three interest rate reducing strategies.

First, see if you can find a 0% balance transfer offer for 12 months. This will give you time to start paying down your balance without paying any interest.

Second, see if you can pay off your credit card balance with a cheaper home equity line of credit (HELOC). Many heloc’s charge interest rates comparable to your mortgage rate, which are at historical lows. Paying 2.5%-4% on your credit card will be a lot better than 19.99%. We put it as the second best option after balance transfers, because nothing beats a 0% offer and because we prefer unsecured debt, if rates are equivalent.

Lastly, if you don’t have a mortgage, see if you can get a low interest rate credit card at 9.99% to 11.99%. While still not cheap credit, it’s a hell of a lot better than 19.99%! Sometimes, if you call and ask your bank for a lower rate, they’ll give you one on your existing card, avoiding the hassle of having to get yet another card.

All in all, there are a number of proven bank beating strategies to choose from to get more bang for your buck. Just stay disciplined, and always remember the Golden Rule: use pre-authorized debit to pay your credit card balance in full every month.

Article comments

Ginger says:

Thanks for this article! It feels good to know that this is possible when credit card companies are unreasonable. I just got dinged by PC Mastercard after I miscalculated the total amount owing (I pay from 2 accounts depending on what the charge is). For my $5 error I was charged $5 in interest – I figured there MUST be a mistake. It was a small amount so I put off calling them until a more convenient time and just paid the bill.

Today I called them to have it corrected. I was shocked when they said that interest was charged for the full amount of the bill!! Yes, charge me interest on the $5 I was short, but why charge interest on the hundred of dollars that I DID pay 10 days early? “That’s just the way we do it.” Rubbish!

Thinking it was a reasonable question to have them reverse the charge because of principal, he refused, saying I should have called them last month. Rubbish again!!

I told him that if they aren’t able to do that, I’ll use up my points and then cancel the card. I won’t be doing business with a bank that treats customers so poorly. There are lots of options out there, and after spending so much on getting customers I am shocked they would let a loyal one go so quickly.

Bye-bye Mastercard. Bye-bye spending $800 a month at Superstore. Bye-bye filling up with gas to get my card points. All for $5. But it’s the principal.

The GreedyRates Team says:

Hi Ginger,

Welcome to GreedyRates. Thanks for your valuable commentary about President’s Choice–we’re sorry to hear you encountered such a frustrating hiccup with your monthly payment. We agree that sometimes the way that banks calculate one’s monthly minimum payment and deadline aren’t ideal, which is why one of the best pieces of advice we have is to set up pre-authorized debits, as you read in the article above.

You mentioned that you pay your balance usually with one of two cards, depending on what the statement looks like on any given month. This method might work well for you, but it won’t with pre-authorized payments. There’s no way to “split” a pre-authorized payment automatically between two cards, or to choose on-demand which card to use.

If you’re getting charged a bit more interest, then consider picking one of your cards to set up automatic debits with. It could save you a bit of money in the long run. Otherwise, go with your first impulse and get a new credit card! There are lots of valuable sign-up bonuses floating around the market now.

For example, if you’re sick of Mastercard and earning points on specific purchase categories, then go the opposite direction and find a Visa that has a favorable and all-inclusive cash back rate. We’re particularly taken with the TD Cash Back Visa Infinite card, which has a 6.00% cash back bonus and annual fee rebate for everyone that applies before August 27, 2018. You won’t be forced to shop at big-box stores to earn cash back, and will love the card’s secondary perks as well. There are fine examples on our list, including many without an annual fee. Thanks again for your comment.

GreedyRates Team

Dean says:

Did you know that when you pay your Rogers bill via your online bank on the bill’s due date, if that date is on a Friday, Saturday or Sunday, or on a holiday, or a bank holiday, then Rogers will charge you a late fee.

Also, Rogers is the only bill I get that ever has the payment date on a weekend or holiday. They do that several times a year.

So check your Rogers bill, you probably have late payment charges on it.

GreedyRates says:

Hi Dean, thanks for coming to us with your discovery. We’re going to have to look deeper into this issue, but haven’t personally found anything to suggest that Rogers will intentionally label payments as late if they are received on a holiday or on the weekend. This may have been an error, and we think you should call Rogers’ customers service to ask about it. They will likely reimburse you, but if not, please return here and update your post. We will do our part as well. Thanks again!

GreedyRates Staff

susan says:

thanks for the “churning” article. Just gonna start doing this. Did not know there was a limit to credit card applications. Do you suggest a few at a time (3or so) every 90 days, or are you suggesting one at a time. Also, do you suggest my husband and I both do applications to get the signup bonus ? Does the same method go for our business cards, as in churning those to ? Last , do you always suggest to cancel, right before the fee is due ? thanks, any other starter advice greatly accepted ! Have a great year churning !

GreedyRates says:

Hi Susan,

Your churning ability will in large part depend on your credit. If you have excellent credit, you might want to start with 1 card every 90 days or so. We would definitely recommend you and your husband apply separately, to maximize your sign-up bonus opportunities, if you have the individual spend to meet the minimum thresholds to be eligible for the sign-up bonuses (i.e. $500 in first three months). The only time you’ll want to consider cancelling, is if an annual fee applies and you don’t intend on using the card in the future. Just make sure you have another card available. You might want to ensure you’ve applied for another card 30 days in advance, to time the approval and shipment of the card appropriately.

Hope that helps.