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Reward Credit Cards Not All They're Cracked Up To Be

Friday, March 16, 2012 - 7:09 AM
In addition to the basic advice of using a plain vanilla style credit card for those who run a balance, Clark Howard offers a warning about a popular 2% cash-back credit card:
The Fidelity Investment Rewards Visa Signature Card is issued through FIA Card Services, which is owned by Bank of America. On this particular card, FIA is not reporting a credit limit. Not reporting a limit can either nick or devastate your credit score considering that how much available credit you use makes up 30% of your credit score.

Ken TuminKen Tumin5,471 posts since
Nov 29, 2009
Rep Points: 125,634
1. Friday, March 16, 2012 - 10:29 AM
CitiBank is doing the same thing on its World Mastercard (and probably other of its cards). But I note, this has nothing to do with whether the card is a reward card. It has solely to do with the credit line you have. It is not at all linked to rewards -- that information is mistaken. Although as it happens, the Word card is a rewards card.

The issue has to do with the status of the credit limit. I forget what Citi calls it, but on some cards, you have a credit limit stated, but you can go over that limit at any time without question, although you have to pay that extra off faster, I think by the next statement date, if I recall correctly. Because you can go over the credit limit to an unspecified amount, they choose to report it as -- what did they tell me, no credit limit or did they say they report zero credit -- since they don't see anything specific to report otherwise. As such, it looks to the credit agencies like you have very little or no credit left on it, and with little credit left on a card, your credit score is dinged.

I went round and round, and round with the presidents office at Citi over this. 

This is something that should be corrected, whether in how it is reported to the credit agencies or how the credit agencies consider it. The problem is that the credit agencies are not being told that you have lots of credit left on the card.
me1004me1004373 posts since
Jan 16, 2010
Rep Points: 2,598
2. Friday, May 25, 2012 - 2:25 AM
One could really get an updated information and get the queries solved by asking the concerned person in this matter. Sometimes it happens that we do not get all the information in a detail manner thus creating a problem later.

RayEthell13RayEthell131 posts since
May 25, 2012
Rep Points: 2
3. Friday, May 25, 2012 - 8:10 AM
I have a  Fidelity Investment Rewards Visa Signature Card and recently ran my three free credit reports from annualcreditreport,com.   All three reports showed my credit limit for the card as $18,000, so unless these agencies are reporting something else to inquiries made by third parties, then it seems to me that Clark Howard is wrong. 

Edit: After further review, my card is NOT a signature card.......Sorry Clark, it was me who was wrong!


StewieStewie56 posts since
Jan 18, 2010
Rep Points: 318