Credit Guide

It is so simple to do; it must be harmless, right? Using your credit card at an ATM works just like a debit card, right? It's OK to use my credit card at an ATM machine because I'll just pay off the debt later, right? If you asked those questions, you'd be wrong on all three counts.

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That's because there are lots of hidden dangers and costs when you use your credit card at an ATM, hidden dangers and costs that go a lot deeper than just the usual problems associated with building up debt and living beyond your means.

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That's because credit cards are set up to make maximum money when they are used at an ATM. They generally charge an extra fee of 2 to 4 percent on cash advances when they're used at an ATM, and that's on top of the usual transaction fees that the ATM's bank will charge you. Plus, an ATM cash advance will also have an even higher interest rate on it than normal credit card purchases. So if you happen to let an ATM cash advance stay on your bill longer than the grace period, you'll see steep interest payments the following month.

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Grace period? Did we say grace period? In many cases, ATM cash advances have no grace period at all. That means that that interest starts to build up as soon as they money leaves the ATM machine and enters your pocket. And that interest grows every minute, every hour, and every day until you pay it off.

Does your ATM check card have a VISA, Mastercard, American Express, Discover or JCB logo on it If it does, you can use the credit card options above to pay using your ATM card. We accept credit and debit cards branded by VISA, Mastercard, Eurocard, American Express, JCB and Discover. We never charge cards until an order ships from our warehouse. Checks and money orders are cashed when we receive them.

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And speaking of paying it off, the credit card company may make it actually difficult to pay it off right away. That's because some credit card companies have their systems designed to funnel your payments first to regular purchases. Then when you pay those off, and only when you pay those completely off, your payments go to paying off ATM cash advances.

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How can credit cards get away with this, you ask? It's like highway robbery. It kind of is. The only problem is that credit cards are private businesses, so they can set the terms of their business any way they want. If you don't like those terms, then don't do business with them. The real problem is that too many people take those terms. In fact, if ATM cash advances weren't so popular, credit card companies might have to then actually loosen their terms!

Credit Card Loss. If you report the loss before the cards are used, the FCBA says the card issuer cannot hold you responsible for any unauthorized charges. If a thief uses your cards before you report them missing, the most you will owe for unauthorized charges is $50 per card. This is true even if a thief uses your credit card at an ATM machine to access your credit card account.

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The key for you then is to obviously avoid ATM credit card advances until very dire emergencies, and even then, only as the last resort of last resorts.

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Joshua Shapiro recommends Find Credit Cards to find an HSBC NV credit card that's tailored to suit your financial needs.

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