Credit Card Checks: Is It a Convenience Check? How to Use it?

Have you ever received a blank check along with your credit card statements? It might have surprised you. It sounds like a great deal for you. The card issuer sends you credit card checks to encourage you to spend out of your credit. This particular check might come to you when you open an account with your card issuer or as a promotional offer.

You can use these credit card checks to make purchases, pay any rent, and pay off your other card. You can also withdraw cash based on the balance or limit of credit assigned to you through checks.

The bank or the issuer prefers to call these checks credit card convenience checks as they claim these types of checks make the life of the user pretty easy to make transactions and make maximum benefits. However, these checks might bring challenges and difficulties if you do not have sufficient information of what are its merits and demerits. Hence, this topic will discuss some relevant points for your convenience. It will guide you on how you can use it so you do not come across any inconvenience while using a convenience check.

Convenience Checks Credit Card: Overview

Some of you might wonder what credit card checks are and how do credit card checks work?

These are like personal checks that you can use to borrow cash or money using your card account. In other words, the bank also calls it a convenience check because you can withdraw advance cash using the line of credit assigned. As explained above, you can pay off your other card, or you can pay the rent or bills.

However, checks are not actually convenience checks credit card as they sound. Because cash advances derived from the line of credit impose high fees and higher interest rates and other hidden charges.

Now, the issuer provides two types: namely advance checks and balance transfer checks.

As for the advance check, depending on your application and approval, the bank will send you an advance check link to your email address. You need to fill out the required personal information on the link.  You can use the advance cash derived from credit for covering immediate expenditures, payment of bills and statements, and purchases of retailers and merchandise.  When you apply for this type of advance cash, the bank or the issuer will set a limit on how much you can withdraw.

The second type of credit card check is a balance transfer check. This type of check will allow you to transfer funds from one of your payment accounts to another account. The important thing you would remember is that you do not have to exceed the given and assigned transfer limit. You can transfer the assigned amount of the line of credit balance to a different card owing an imposition of a 3% to 5% commission for using the facility of credit check.

Situations When You Can Use Credit Card Checks

You can use the credit card check on the occasions specified in these three instances.

1- Convenience checks credit card become pretty much handy when you are not allowed to use your credit cards. For example, you need to pay your rent but your landlord is not accepting the money getting paid through your card. However, he is ready to accept the money transferred from the balance of the line of credit.

2- The second scenario where it is quite worth using is when you do not have money in your checking account or debit card. In other words, if you are not able to use any of these, you can take the help of credit card checks. You will need to write yourself a credit card convenience checks and cash it out the way you would do in case of a personal check.

3- The third instance is when you are not able to pay the credit card bill/statement with a credit card. It is quite a common fact that most credit card issuers would not let you pay their bills with the credit card checks they issue to you. However, you can use that credit card checks to pay bills on other credit cards that you might have.

Limitations & Drawbacks of Credit Card Checks

Credit card checks are synonymous with convenience checks credit cards. However, they are not actually convenient to use due to the fact that they come with a lot of limitations and demerits.

They are like cash advances meaning they would be accompanied by advance fees (accruing out of advance cash), and higher interest rates. And on top of that, there are very strict penalties imposed during your repayment. In contrast to the average APR of credit cards, it is 25 percent or even more.

The worst part of credit card checks is that it does not have any grace period. As soon as you use it, the grace period starts accruing. Failing to pay immediately, you will have to pay additional and exorbitant interest charges.

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Another noteworthy drawback that you need to keep in mind is that you will end up having to pay a penalty fee for writing convenience checks going beyond your credit limit.

The fourth drawback that accompanies credit card checks is that you cannot withhold the payment. When you purchase something using your credit card, you can withhold the payment if you see any issues with the product or services you are going to buy. But, in the case of a credit card check, you cannot withhold any payment. 

Another limitation that is imperative to mention is that convenience checks can be liable for fraud. It does not require any signature for authentication for transactions which makes it vulnerable to fraudsters. They easily access your line of credit on account of exposure.

Hence, going by all these limitations, its demerits outweigh its merits to some extent. Whenever you would choose to use it, it is better to consider both pros and cons.

Security and Safety of Convenience Checks Credit Card

There are some security concerns that you need to be well aware of while using the convenience checks credit card. In order for you not to get impacted by threats of fraud and scams, it is better to keep yourself updated with precautions.

Scams and Identity Theft: You might sometimes keep your credit card checks in the mailbox and anywhere that might attract the attention of scammers and fraudsters. They may use their vested interest. Your personal and financial information is exposed to them thereby putting yourself more vulnerable.

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Penalties: As there is no predefined limit for your credit check write-off, you would sometimes write yourself a convenience check exceeding your credit limit. As a result of this, you need to pay the penalties.

Ambiguous promotional offers: The issuers of credit card checks might trap you with crafty motives with their promotions and advertisements. These promotions come at the cost of other hidden charges.

No Grace Period: You are well aware that credit cards come with a grace period for the repayment of the bills. However, the convenience checks don’t. Due to the absence of a grace period, the interest rates start to pile up from the day you have purchased the products and services.

Absence of Dispute Process: Once you purchase anything, it might lead to some issues. However, you cannot approach the issuers to inform the issues. You need to directly approach the seller to solve the issues.

The Cost Involved in Credit Card Checks

There are two types of costs involved namely transaction fees and annual interest rates. For example, if your card has a transaction fee of 3%, you will need to pay $30 for a credit card check amounting to a $1000 request. Now, as for the annual fee it ranges from 25% to 30% through credit card checks might get you a 0% annual interest rate in some instances.

Ordering Credit Card Checks from Issuers

The banks and issuers now and then send promotional offers via email. Hence, it is not even required to send in any form of request. In case they don’t send any kind of promotional offers, you can request and approach them for a credit card check. Some financial institutions offering convenience checks are:

• Bank of America: If you are a client of Bank of America, you might be aware of the Preferred Rewards program. You can register for this program and they will issue checks free of charge.
• Wells Fargo: Wells Fargo credit card checks are called ‘superchecks’. They charge 5% for using the checks while their annual interest rates vary from 24.99 to 26.99 and it depends on the user’s score.
• American Express: American Express has diversified its services into many fields such as tourism, and offers card services, and traveler’s checks. You can use the traveler’s checks and cash them out.

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Apart from the above-mentioned financial institutions, there are other banks that are providing the facilities of card checks such as PNC Bank, Barclaycard, and Citizens Bank.

Frequently Asked Questions (FAQs)

Q1. How to get convenience checks from credit cards?

You do not have to approach your bank or issuer for any convenience checks. The banks or issuers send the check to the client’s email as a promotional offer. If you need it for any unforeseen emergencies, you can directly contact the issuers. Based on approval or rejection, you will qualify for a credit card check.

Q2. Which is true of credit card convenience checks?

You can pay the bills of other credit cards. This is the true part of credit card convenience checks. Because you cannot pay the bills using the same card you have received the bills for.

Conclusion

Convenience or credit card checks are just a way that the banks are utilizing to bring their clients to inculcate a habit of using their credit. They give promotional offers so that the clients use the line of credit attached to their credit cards. This will sound pretty good for those who do not mind the interest rates and other penalties.

However, before using credit card checks, you should remember how worth it will be for your financial transactions. And also, how much it is going to support the budget. Because there are some disadvantages which need your attention and consideration. Analyze the pros and cons. Depending on your research, you will come up with your decision for sure. Because convenience or credit card checks are not just free money.