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[11:53:13 PM Wednesday, April 04, 2007]
New credit card offer is automatically to come as present card goes bad
You may have noticed that at some moment you get overloaded with new credit card offers more aggressively than ever. Suddenly you find yourself facing best rewards credit card offers or credit card offers with rebates and you think: "Has my credit score boosted or something?"
Well, everything is easier. The period of your credit card use comes to its end which is called by credit card companies expiration date. All banks and credit card associations, like Visa and MasterCard, include expiration date on their credit cards.
What does it mean when your credit card expires? Look at the back side of your credit card and you'll see a magnetic strip there which goes bad in a set period of time after accepting the credit card offer. When the magnetic strip goes bad, the expiration date comes and you cannot use your plastic any longer.
All big and respectful banks and credit card companies equip their credit cards with magnetic strips indicating to the expiration of your credit card and they have sound reasons for that. Bank of America's or Citibank's top credit card offers all bear magnetic strips and thus have expiration dates.
When the magnetic strip goes bad, the expiration date comes and you cannot use your plastic any longer. That gives a signal to your credit card company that they can issue you another credit card and make a new credit card deal with you.
But that's not the only reason for including expiration date in your plastic. Creditors will most probably be very reluctant to refuse from expiration dates, explaining it in the following way:
• The magnetic strip bearing all your credit information and used for making offline credit card transaction is not forever, it has a lifespan and the expiration date defines it;
• Expiration date is an effective protection from identity fraud and theft in offline credit operations (those processed manually).
However, with today's rapid growth of online credit card authorizations, the expiration date becomes less significant for fraud protection but that's not a sound reason enough for abolishing it.
How do credit card companies profit by expiration dates? Don't you think that it's a good pretext for them to keep in touch with you and offer you new services or new card as soon as the present one gets "old"? But that's exactly what they do.
And you, as a wise and thoughtful credit consumer should be on the alert when you see the expiration date is coming.
First, try not to go abroad or somewhere far when your plastic expires as you'll probably want to accept a new credit card offer.
Then, if there does arrive a new credit card and you're going to get it, be very attentive as a new credit card offer implies new terms. Scrutinize the contract and analyze its APRs, fees, late charges and other terms to be sure the new credit card offer is worth accepting.
It may so happen that you cannot afford taking this very credit card and it's better to notify your creditors of it in writing. It is also time worthy to try negotiating for better terms and if the lender is reluctant to lose you as a credit valuable client, they will yield.
One more important point to mention about expiration date is that it may be different and is determined by your creditor based on your reliability and value as credit card holder. As a rule, the expiration date is about 4 years, and if it is less on your plastic, address your creditor to find out why.
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