Just for fun, here’s the fine print from a card Maria’s considering. It’s a Discover with a 5% cash-back bonus program. She really likes the higher cash back percents, but is a little leery of the variable rate.
New insights she gains include
• If she makes a late payment, she’ll lose her 0% intro rate.
• Then she sees how complicated the cash back program is and that it has lots of conditions, that she has to sign up for each individual program, and that she loses everything if she’s late or doesn’t use her card.
• She decides she’d rather go with a basic, no strings cash-back card even if it pays back a little less than this one.
HOW WE WILL CALCULATE YOUR BALANCE: We use a method called "daily balance (including new purchases)."
LOSS OF INTRODUCTORY APR: We may end the availability of any intro APR on new purchases and balance transfers and apply the Penalty APR to those transactions if you make a late payment.
HOW WE CALCULATE VARIABLE RATES BASED ON THE PRIME RATE: We use the highest Prime Rate listed in The Wall Street Journal on the last business day of the month. For the purchase APR, we add from 7.74% to 17.74% to the Prime Rate based on your creditworthiness. For the cash advance APR, we add 20.74% to the Prime Rate. For the penalty APR, we add from up to 12.74% to up to 22.74% to the Prime Rate. Each time you do not make a payment by the payment due date, we may add up to an additional 5 percentage points to the otherwise applicable APR. The amount we add is based on your creditworthiness and other factors such as your current APRs and your account history. See Cardmember Agreement for details.
BALANCE TRANSFERS: This offer applies to balance transfers that post to your account by 10/10/2012. Balance transfers requested after this date will only be honored at our discretion. It takes at least 14 days after your account is opened to process payments to your other accounts. You may cancel a balance transfer at any time prior to that by calling 1-800-347-2683. Continue to make all required payments to your other accounts until you confirm that the balance transfers were made. Balance transfers may not be used to pay any Discover accounts and do not earn rewards. You may transfer any amount, up to your credit available for transfers, which may be less than your total credit line. If your balance transfer request will exceed your available credit, we will process your transfers for less than the amount requested, in the order requested. You may only make balance transfers to accounts that list you as an accountholder. There is no grace period on balance transfers. The minimum payment due calculation increases by $40 when you have a balance transfer balance. The minimum payment requirement can cause promotional balances to be paid in full prior to the end of the promotional period. You can avoid paying interest on new purchases if you pay your entire balance by the due date each month. This means that, unless your purchase APR is at a promotional 0% APR, you will pay interest on new purchases if you do not pay the balances you transfer under this offer in full by the first payment due date. See your Cardmember Agreement for details.
PAYMENT ALLOCATION: We apply payments and credits at our discretion, including in a manner most favorable or convenient for us. Each billing period, we will generally apply amounts you pay that exceed the minimum payment due to balances with higher APRs before balances with lower APRs as of the date we credit your payment.
APPLICATION INFORMATION: Federal law requires that we obtain certain information about you such as your date of birth and street address in order to verify your identity. You authorize us to receive and exchange information about you, including from your employer, your bank, credit bureaus and others for purposes of verifying your identity and the information on this application and determining your eligibility for credit, renewal of credit, and future extensions of credit. By providing your phone numbers on the application, you agree that Discover, its affiliates and agents, may call you at these numbers for service-related reasons. If this is a cell phone number you agree that we may contact you using a dialer for service-related reasons, including pre-recorded messages and/or text messages, even if your cell phone provider may charge you for calls according to your current plan. Upon your request, we will inform you of the name and address of each consumer reporting agency from which we obtained a consumer report relating to you. Offer only available to U.S. residents 18 and older. To apply with a joint applicant, write to us at PO Box 30943, Salt Lake City, UT 84130-0943. Every applicant, regardless of marital status, can apply for a separate account. THIS OFFER SUPERSEDES ALL PRIOR OFFERS. Terms of this offer, including fees and calculations of variable rates, are accurate as of the printing date of 6/29/2012, and may change after that date. To find out what may have changed after that date, write to us at PO Box 15410, Wilmington, DE 19886-0820. Please allow 30 days for us to process your application.
CREDIT LINE: Applicants may not request a specific credit line. If you are approved, your credit line will be at least $500 and along with other terms of the account, will be based on a review of the information you provide in this application and your consumer report; it may also include other information we may have bearing on your creditworthiness. Balance transfers made with an application are not considered to be a request for a particular credit line.
CARDMEMBER AGREEMENT: You will receive a Cardmember Agreement with the Card. You agree that the Cardmember Agreement and the account are governed by Delaware and federal law. The terms of your account, including rates and fees, are subject to change, to the extent permitted by law.ARBITRATION: The Cardmember Agreement provides that we may choose to resolve a claim relating to your account by binding arbitration, in which case, you will not have the right to have that claim resolved by a judge or jury and you will not have the right to participate in a class action in court or arbitration. You may reject the arbitration provision with respect to your new account within 30 days after receiving your card. Ohio Residents: Ohio laws against discrimination require that all creditors make credit equally available to all creditworthy customers, and that credit reporting agencies maintain separate credit histories on each individual upon request. The Ohio Civil Rights Commission administers compliance with this law.New York Residents: Call the New York State Banking Department at (877) 226-5697 for a comparative list of credit card rates, fees and grace periods.Wisconsin Residents: No agreement, court order or individual statement applying to marital property will adversely affect a creditor's interests unless prior to the time credit is granted the creditor is furnished with a copy of the agreement, court order or statement, or has actual knowledge of the adverse provision. Married Wisconsin residents must furnish their spouse's name and address to us at PO Box 15410, Wilmington, DE 19886-0820.
REWARDS: Earn cash rewards on all your purchases. Full terms and conditions will be sent with your card. Earn 5% Cashback Bonus® on category purchases up to the quarterly maximum. You must sign up for each 5% program. Earn .25% Cashback Bonus on your first $3,000 in annual purchases and on all warehouse purchases made at warehouse clubs, wholesale distributors, discount stores and their affiliates. Earn 1% on purchases over $3,000. Warehouse and 5% category purchases do not count towards your first $3,000. Rewards do not expire, but you will lose any Cashback Bonus in your Cashback Bonus Account if your account is closed for any reason, your account is inactive for 18 consecutive months, or if you fail to make any Minimum Payment Due for two consecutive billing periods.
INSURANCE: Excess Collision Damage Waiver Insurance and Scheduled Air Travel Accident Insurance are underwritten by Federal Insurance Company, a member insurer of the Chubb Group of Insurance Companies of Warren, NJ. Certain restrictions and limitations apply. Refer to the Descriptions of Coverage for more complete information.