I’m sure many of you have a credit card and chances are you’ve probably received convenience checks. They’re those personalized blank checks which are typically mailed in sets of three and are tied to your credit card account that can be used to make a purchase or to transfer balances. They come with hefty fees, some are as much as 5 percent of the check amount and the interest rates are often 20% or more.
These checks are called convenience checks for a reason: all you have to do is fill them in and sign them. Sure, convenience checks can come in handy when you’re in need of fast cash. But they should only be used as a last resort. Because the checks are linked to your credit company, chances are you’ll be charged ridiculous fees for using the checks. The fees can be anywhere between 2% to 5% of the check’s amount. Also, convenience checks are not like credit cards, you don’t get a 30 day grace period to pay off the balance before the interest kicks in. The interest kicks in the moment your convenience checks are cashed. Convenience don’t come free these days, you got to pay for it.
Another downside to convenience checks is that they don’t offer the same protection as your regular credit card. If you charge something to your credit card, a lot of the times the credit card company would provide extra warranty to purchased product. Meaning if you’re dissatisfied for any reason about the product, a simple call to your credit card company and they’ll reverse the charges and credit your account. Whereas if you purchased the product by using the convenience checks and if something goes wrong, you’re on your own.
They also provide criminals with a convenient way to commit fraud. It’s easy for criminals to steal your checks and then just sign them because there’s no signature verification with convenience checks as there is with credit cards. So if a thief does get their hands on a convenience check they can easily make purchases, get cash, or even open a bank account with the stolen checks. The vast majority of convenience checks can be picked up and used by anyone. People sometimes don’t think and just toss them in the trash. That could lead to some serious problems down the road. If you don’t plan to use them, tore them up and then toss them in the trash.
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