Conference 7.286::dcu

    I've recently started getting rid of all my annual fee charging credit
    cards as they come up for renewal.  I kept them for emergency use when
    I had my airplane.  Since I no longer have the airplane, I don't need
    all of them.  So far, they have all agreed to waive the annual fee when
    I told them I wanted to cancel them.
    
    Come December, we will see just how bad DCU wants my business.
    
    Bob

    Why pay a credit card fee ? There are many free cards and there
    are also free cards that give you cash back.I just cashed a $31.76
    dividend check from my FORD VISA card.It's a no fee card and I have
    never paid a cent of interest.
    
    All places I've dealt with ( except DCU ) waive the annual fee when
    you tell them you have free cards and don't wish to pay a fee.
    
    Credit card fees are real sleazy.They want you to pay for the right
    to credit at above loan shark rates.No thanks.
    
    
    Mike
    

    re: .2
    
    I am trying to very nicely point out that the DCU is going to lose a
    non-trivial amount of interest income from me if they don't drop this
    annual fee when my card comes up for renewal.
    
    Bob

    I cut up my DCU Visa and sent it to 'em after they announced the new
    annual fee structure, even though I could have used it for all of '92
    without an annual fee.  I figured the least I could do was to prevent
    them from getting the 1-2% from the merchandiser on my '92 purchase
    for implementing such a dumb fee.

It was easy for me to make the annual purchase threshhold, and considering
the amount of merchant's discount $6000+ represents, the card fee seems
greedy.  "Greedy", of course, is a term of opprobrium when applied to a
cooperative organization like a credit union.  Presumably, when applied to
a bank, it doesn't make much of an impression.

What I would tell a bank is that the fee isn't very competitive either.  I
just accepted a reasonable no-fee offer from Fidelity Investments and won't
be needing my DCU VISA come January.

\Joe

	I too decided that I would not pay annual fees again on any
	credit card.  Since I pay off all balances when they come due,
	I never pay interest, either.  I've got an AT&T Universal Gold
	card that has a competitive rate (14.9%?) and NEVER an annual
	fee for as long as I live if I use it once a year.  And that
	is not a problem for me -- I'm married!  8^)

	If DCU were to offer something similar, I would get and use their
	card instead.

	-- Jim

Re: .6,

For most credit card companies, 2/3 of the customers have an average
balance of about $2,000.  For ATT, 2/3 of their customers have NO
balance - that's not unexpected since folks who pay up every month
would naturally gravitate to ATT.

Given that there's really no differentiation between a DCU VISA and
an ATT VISA, what would the DCU gain by matching ATT's offer?

What would the DCU gain if the DCU matched the Discover card and
gave rebates?

Gim

  Fees to the user and interest are not all that credit card issuer's get.
They also get money from the merchants so if the cash flow is great enough
they make money.

    
    Re: .7
    
    >Given that there's really no differentiation between a DCU VISA and
    >an ATT VISA, what would the DCU gain by matching ATT's offer?
    >
    >What would the DCU gain if the DCU matched the Discover card and
    >gave rebates?
    
    	Well, if DCU doesn't want to just match these programs since they
    have an even more attractive one in the works, then yes, DCU shouldn't
    match these programs... :-)  The question boils down to marketing
    mind-share.  DCU is being seen as "old" style credit cards and
    customers are migrating to the "new" style.  DCU can change to preserve
    their customer base, or can stick to the old style and watch the base
    erode.
    
    							-craig

    I still see alot of "old style" credit cards out of there.  Maybe it's
    just me, but all I've gotten from the "I don't want to pay a yearly fee
    anymore" is "Nice doing business with you, please cut up your card".

    re: .10
    	It must be you.I cancelled a pair of cards when the fee came due
    (first year was free).A few weeks later I was cleaning out my wallet
    and decided that since I cancelled this VISA pair I should cut them up.
    Whithin 2 hours I got a phone call from the VISA people wanting to
    know why I was cancelling.I stated that it was the fee and by the way
    the call was a little late as i had just cut them up an hour ago.
    Their response was no problem,we'll waive the fee and send you a new
    set.
    
    
    Mike

  It may depend upon how much you use it.

    I couldn't agree more with re:2. 
    There are many fee free cards with lower interest rates than DCU. I use 
    one card only when a purchase exceeds my pocket cash, and pay more than 
    the minumum due. The bank makes money on both ends of that transaction, 
    and any more such as an annual fee in a sign of greed.
    I also have other fee free cards for investment reasons that don't get 
    used much. The last thing I need is $25-35 annual fees on multiple
    cards, which add up quickly.
    
    My 02's worth, Dave'
    
    
    
     

    I received an offer for a fee free card in the mail the other day. 
    Sure, the interest rate quoted sounded reasonable.  They even offered a
    rebate program similar to that used by the Discover Card.  I read on,
    however, looking for the catch.  There it was.  The reasonable interest
    rate was good for only the first 6 months of the card.  After that it
    went up significantly.

    re: .14
    
    Are you sure it wasn't an old DCU credit card application that got lost
    in the mail :-)
    
    Bob

RE: Note 608.14 by PATE::MACNEAL

>    I received an offer for a fee free card in the mail the other day. 
>    Sure, the interest rate quoted sounded reasonable.  They even offered a
>    rebate program similar to that used by the Discover Card.  I read on,
>    however, looking for the catch.  There it was.  The reasonable interest
>    rate was good for only the first 6 months of the card.  After that it
>    went up significantly.

Not with USAA or a couple others.  Free cards and less than 13% interest for the
WHOLE amount.  USAA is rated extremely well.

In fact I remember at a DCU meeting in ZKO, I said this.  The DCU rep acted
like this were not so and in a 'puffed up, this is impossible tone of voice' asked
whose card it was.  When I mentioned USAA, then the person deflated and said,
'Ohhh'.  She turned away and acted like it did not happen.

There are at least 5 or 6 other companies who have as good of rates if not better.
DCU is better than Citicorp, Chase and those types, but when you pay attention
to the competetaive smaller groups (like DCU should be), then you find they
are not cheap...

	- mark

    	I have to check on this but why not...
    	charge the $6,000.00 on my DCU VISA for a day and pay it all back
    the next day with the $2.30 interest. This should fulfill their
    requirement unless they want a balance of $6,000.00 every day all year.
    
    	BTW the $2.30 interest is $6,000 X 14%/365
    
    			Arnie

    Help clear something up.  I read in a flyer sent home that I could avoid
    the yearly fee if I had x dollars in ALL my accounts.  This implies
    all accounts that are in my kids and my name.  If so, I have more that
    enough to meet the limit to avoid the fee.

    But when it came time for renewal, DCU did not take this into
    consideration, so I canceled my DCU VISA and got a free one from a bank
    here in Dallas.

    Do I understand this correctly and if so then someone at DCU needs to
    look at their system to see why mistakes like this are made.

    I would like to support the DCU and by using the VISA, I see that as a
    way of doing so.  But I will not pay a fee (most of the financial
    institutions her in Dallas do not charge a fee anymore) for the right
    to have a plain credit card.

I'd suggest writing suggestions like this up and sending them on to
Chuck. I'll try to remember to tell him when I see him also.

    There was an article in the paper Sunday stating that due to
    competition, the average interest rate on credit cards was now 15%.  It
    also stated that all the credit card companies that charge annual fees
    were waiving them upon request.
    
    I guess they never heard of DCU.
    
    When my annual fee shows up on my statement, I'll call and request a
    waiver.  If DCU refuses, I'll cancel the card.
    
    Bob

    I tried that at the beginning of the year after they announced the
    "new" annual fee structure.  They refused to waive the annual fee
    (even tho it wouldn't take affect til the end of the year).  I cut
    up the card.  Another Visa card with no annual fee saw @$6k of
    purchases this year; at a conservative merchant usage charge of 3%,
    that's about $200 the DCU missed out on.

    re: .21

    I know what you mean.  I have stopped using the DCU card in
    anticipation of cutting it up next month, unless the BoD can bring DCU
    to its senses on this matter.
    
    The article I referred to earlier, basically said that anyone with over
    $2K/year in purchases was a customer that the card issurer shouldn't
    lose, and went further to state that the annual fee would probably
    become a 'penalty' for bad credit risks, in the future.
    
    Bob

re: .21 & .22

I suspect that there are significant numbers of current members who share your 
feelings about annual fees for VISA cards.  We switched from DCU VISA to AT&T 
no-fee VISA when DCU changed their policy.  We, too, charge several thousand
dollars on our card each year.  I, for one, would rather see the income from that
business go to DCU than AT&T but I am not willing to pay for the privilege of 
moving my business to DCU.  I still have my DCU VISA card and I will start using 
it again if the annual fee is eliminated.  However, if they bill me for the 
"privilege" of using the card to provide income to DCU, I plan to cut it up.

Has Chuck (or the board) considered doing a small scale survey of its members to
see how much more business it could get if it changed the annual fee policy?  I
suspect that they might be surprised by the "silent majority"...

						Gary Hicks

    Re: .21 by OLDTMR::BROWN 
    
    >   Another Visa card with no annual fee saw @$6k of
    >   purchases this year; at a conservative merchant usage charge of 3%,
    >   that's about $200 the DCU missed out on.
    
    There are at least 3 parties any charge transaction:
    	a.  the merchant's bank,
    	b.  VISA international,
    	c.  the Credit Issuer (DCU)
    
    It would be surprising if the DCU kept the 3%.  In most cases, it's the
    merchant's bank that determines the discount rate.
    
    Gim
    
    
    

    
    Income from credit cards is made in one of three ways:
    
    	1. Interest income
    	2. Annual fees (and others)
    	3. Interchange income
    
    Interest income is by far the biggest income generator therefore all
    credit card issuers are in heated competition for those card holders
    that carry a balance.  These 'rollover' users pay interest on the
    outstanding balance and generate income from charges (interchange
    income).  Annual fees may or not be waived for these people (in
    general).
    
    Then there are the 'convenience users' who usually pay off the entire
    balance when due.  These users do not generate much, if any, interest
    income, but usually pay an annual fee and generate interchange income.
    Income from this group is lowest and unpredictable if the person has
    many cards and doesn't use one a lot.
    
    And then there are people who are in the middle, who occassionally
    use the credit card to finance purchases for a few months and pay it 
    down to zero.
    
    The convenience user group is a large percentage of card holders, about
    38% at DCU which is a bit above average.  The interchange rate is .014
    (1.4% of purchases) which means people have to charge about $1430 to
    cover a $20 annual fee.  Now there are also monthly statement costs so
    let's push that $1430 up to $2000 to account for it.  That means that if
    people charge under $168/month, the card issuer is losing money on the
    card if no annual fee is charged.
    
    I would like to conduct an informal survey to determine just how much
    people who are 'convenience' users charge in the course of a year.  I
    would like to request people who are convenience users to post info 
    (or send mail to me, confidentiality guaranteed) concerning the amount
    they charge in the course of a year (or two) on all their credit cards that
    could be charged to a DCU Visa card, if you had one.  In other words,
    exclude charges at places where you couldn't use a Visa card.  I
    realize this might be a bit of work but it would be a great help to me
    (and probably a real eye-opener for you).  If I get enough replies, I
    will compile and post the information here (in summary form of
    course).
    
    Thanks in advance for any and all replies!

  You are right...  I got $110 back from Discover last year and of course
they got no interest.  I tried hard to use Discover thru the year so 
some of the use was abnormal.

>	The interchange rate is .014 (1.4% of purchases) which means 
>	people have to charge about $1430 to cover a $20 annual fee.  
>	Now there are also monthly statement costs so let's push that 
>	$1430 up to $2000 to account for it.

	Then what does the $20 annual fee cover? I thought it covered
	the costs of administrating the card, including statements.


	I pay no fee for any of the cards I carry. Since I got a 
	Discover card, I tend to use it wherever possible, since it
	pays you back a little each year. I also carry a no-fee VISA
	since Discover isn't accepted at a lot of places. Right now
	I'm using the VISA whenever possible, since the VISA vendor
	is running a promotion consisting of a 1% rebate of that vendor's
	VISA use in the next couple of months. DEFCU doesn't offer anything
	close to this (on top of the Annual fee that they charge.)
	My own feeling is that DEFCU may not be able to compete in this
	area, and if so, should not try, and instead concentrate on areas
	where they can be competitive.

						Tom_K

    From what I've seen, DCU is offering a competitive interest rate. 
    While this may not be a factor for those who pay off their charges
    every month apparently that only represents 38% of DCU Visa Card
    customers.  DCU is offering a no yearly fee option.

    re .25
    So with $6k in purchases in '92 (so far), that means the DCU missed
    out on about $64 profit (0.014*6000-$20), which would have paid for
    three no-use no-annual-fee users.  One of the most annoying part was
    when I called the DCU in January and very nicely threatened to cut up
    the card immediately if there was an annual fee of any sort, no effort
    was made to look at my previous usage... I was simply told "no".  After
    I cut up the DCU card in January, the money went to AT&T.
    
    Gee, somebody over there in PKO5 shoulda waived my annual fee when I
    asked, huh?  Wonder how much they'll miss next year... 
    Kratz

>              <<< Note 608.28 by PATE::MACNEAL "ruck `n' roll" >>>
>
>    From what I've seen, DCU is offering a competitive interest rate. 
    
    Yes, I agree.
    
>    While this may not be a factor for those who pay off their charges
>    every month apparently that only represents 38% of DCU Visa Card
>    customers.  
    
    	*ONLY* 38%???
    
    	The question is are convenience card users profitable?  If *ONLY*
    	50% of that *ONLY* 38% charge an average of $5000 a year then DCU
    	has made a cool $119,000 profit.
    
    		Total cards	      15000
    		times % conv. users    *.38
    				      -----
                                       5700
    
    				        2850 (be conservative & divide by 2)
    		times $3000           * 3000 (amount over breakeven amount)
    		times interchange rate* .014
                                       -----
                                     $119700 profit
    
    	
    >DCU is offering a no yearly fee option.
    
    	Yes it is.  The question is "Is it based on valid reasoning that is
    not resulting in the credit union losing potential income?".
    
    I invite all convenience users to get the new Phil G. Visa!  We
    all need a contingency plan these days...  ;-)  

Phil, thanks for asking about our credit card usage.  It made me realize
some things!

DCU Visa

    I had a DCU Visa when it was first introduced, until the day when I was
    about to be charged an annual fee.

My Visa Use

    I am a convenience user.  I charge most large purchases, and unexpected
    purchases.  I pay most bills off in full each month.  I've paid finance
    charges maybe 2 months out of the last 60, on balances of less than 
    $1,000.  My annual charges total about $5,000.

Current Visa Card Has Fee!

    The Visa card I currently have does carry an annual fee.  In the context 
    of the DCU discussion, this may sound funny (it does to me).  I object 
    to having to pay an annual fee, because it is not necessary: there are 
    cards out there which do not have an annual fee, or the company is 
    willing to waive the fee if asked.  No one else in my family pays an 
    annual fee for a Visa card.  But, I am willing to pay the fee each year 
    for the card I have now.

Tangible Benefits

    My current Visa card is connected to an airline frequent flyer program.  
    Every dollar I charge gets me a mile of travel in my frequent flyer 
    account.  So, for my $35, I get a minimum of 5000 miles credited to my 
    account.  I cannot physically travel 5000 miles for that price.  These
    miles combine with actual miles flown to help me get free flights, and
    other awards.  My last trip I saved $35 on just one two-day car rental.
    Plus I am identified as a special person by the airline, and I receive
    more information and bonuses than if I did not use this card.  Also, 
    with this benefit, I tend to charge more things than I otherwise would,
    just to "get the miles".

DCU Visa's Annual Fee

    The point is, I don't mind paying an annual fee if I see some tangible
    benefit.  In the absence of the benefit, I would go with a card with
    no annual fee.  Even though I pay my balance off most of the time, I
    do a steady business with the card, which my frequent flyer program
    appreciates, and lets me know.  Others have said they use the Discover 
    Card for the cash back feature: another tangible benefit.
    
    If, after careful consideration, DCU decides that the annual fee must 
    stay, the benefit must become tangible to the members.  Show us in hard
    numbers how much faster we will get back to healthy asset ratios with 
    the annual fee.  Update us quarterly on how the fee is affecting the 
    bottom line.  And, make it a closed end fee.  Let the next BoD meeting 
    minutes tell us that the policy of charging an annual fee on Visa cards 
    will be abolished once we have paid for the sins of the Mangone scandal, 
    and we are at our desired asset ratio.

    Because, after all, isn't that what it's all about?

Elaine Ritchie

    re: .31
    
    I was with you 100% until...
    
    >If, after careful consideration, DCU decides that the annual fee must 
    >stay, the benefit must become tangible to the members.  Show us in hard
    >numbers how much faster we will get back to healthy asset ratios with 
    >the annual fee.  Update us quarterly on how the fee is affecting the 
    >bottom line.  And, make it a closed end fee.  Let the next BoD meeting 
    >minutes tell us that the policy of charging an annual fee on Visa cards 
    >will be abolished once we have paid for the sins of the Mangone scandal, 
    >and we are at our desired asset ratio.

    >Because, after all, isn't that what it's all about?
    
    No, that isn't what it is all about.  The DCU is healthy.  It's not as
    rich as some would like, but it isn't sick.  I don't expect DCU to be
    the best in everything or be everything to everybody, but I do expect
    it to be competitive in what it does.  I have 2 other gold cards and a
    Discover card that charge me no annual fee.  I refuse to pay for the
    sins of the past BoD with uncompetitive service offerings.  If DCU
    can't provide me with a competitive service, I won't use it.
    
    Bob

re: .32

Well, I sortof agree with you, too.  I cut my arguement short because lunch was
over.

I think DCU can afford to make the Visa no-fee, or make it no-fee if you charge
$X per year.  But I've invested something in this DCU, and I might be willing to
make a sacrifice (pay a fee for 2 years) to attain a goal (DCU has proper asset
ratios).

But I really do like the setup I have now, and I don't think I'd really change.
I was trying to make an observation, and, stimulate some reaction 
:-)

Elaine

p.s. What I really want DCU to do is pay interest on checking accounts with no
minimum balance if I direct deposit my paycheck.  But that's a separate topic

    Phil,
    Instead of us telling you about our charge habits, I think it would
    be more interesting for the DCU to go thru its list of Visa cards
    that were cancelled this year due to an annual fee (my reason),
    and then go back and see the total they charged for the previous year.
    Anything less than $1.5k may have represented a good decision to let
    them cancel; anything more and it probably wasn't too bright.
    
    I wouldn't doubt that you'll find that the annual fee is doing a good
    job of skimming the much-sought-after cream off the top.
    
    P.S. well put Elaine, and seeing as how you care a great deal about the
    DCU than most of us, they lost a EXTRA valuable customer.

To clear up some of the quasi-misinformation on discount rates earlier in this
note:

The discount rate (the amount of total purchase price withheld from the
merchant to cover costs) varies between banks AND with the merchant's sales
volume.  It is also affected by whether the merchant is using an electronic
capture terminal (ECT).  The rate for VISA/MC is in the range of 2.25% and is
adjusted annually by most banks based on the total sales volume and the
daily averages.

Discover seems to use a fixed discount rate of 2.00%.  American Express
most commonly uses a discount rate of 3.5% with a dividend rate of 1.00%
for Optima cards.

The only time a discount rate gets as high as 3% is with a straight AX
card or for a merchant who refuses to spend ~$300 (one time) to purchase
an ECT and insists on submitting paper charge slips to the bank.  VISA
International charges a higher service charge for processing real paper.

    
    Good reply Elaine.  I also agree with Bob's reply to it.  
    
    RE: .34
    
    Good suggestion.  I will see if DCU can determine this.
    
    Several people have sent me mail after examining their charge habits.
    Real data and behavior patterns are invaluable and I would ask people
    to take the time to help me out here.
    
    Thanks to everybody who has responded so far!

    Here's my information.
    
    I haven't looked exactly but I charge somewhere between $5,000 and
    $10,000 per year. I ALWAYS pay off on time. Not paying those loan shark
    rates to anyone.
    
    I used to have a Baybank Card. Last year when they were about to sock
    me with another yearly fee I called them up and said:
    
    	"Waive the yearly fee for ever or I cut up my card"
    
    They refused to waive the fee so I cut up my card and went with the
    AT&T card which guarantees no annual fee EVER.
    
    To get me to ditch that card and move to a DCU card they'd have to
    better the AT&T deal. I couldn't care less about the interest rate,
    charge 50% if you like. But to get me to get a DCU card DCU would have
    to kick back some money ie make it better than AT&T. That's the only
    way I'd move.
    
    Dave

	DCU members will have their Annual DCU Credit Card fee
	waived if they fall within one of the four groupings below:

	1)  They maintain $3500 in savings at DCU
	2)  They have $6,000 outstanding in DCU loans
	3)  New card holders (for the first year)
	4)  Members that obtained a DCU mortgage loan that was sold

	Thus, the pricing of this product encourages you to maintain
	a relationship with the DCU.  I think that's a good policy.
    	My understanding is that over 90% of of deposit accounts and 
        85% of the loan accounts meet this criteria, thus, fee income 
        from DCU credit cards is minimal.
	
        Regards,
    
        Tanya

    

    
    RE: .38
    
    I realize that.  What I was referring to was the logic people use when
    deciding to use or get a credit card.  The credit card market has
    changed a lot.  If institutions offering them don't change to meet the
    competition then the future may not be bright.
    

>    	My understanding is that over 90% of of deposit accounts and 
>        85% of the loan accounts meet this criteria, thus, fee income 
>        from DCU credit cards is minimal.

	Then why not simply abolish it, and do away with the overhead
	of tracking a person's eligibility for a free card? Perhaps
	DEFCU would end up saving more than it is currently making on
	annual fees.

					Tom_K    

    I don't give out personal finance information, but I do agree that the
    credit card business is changing.  For what it's worth, I don't want
    any more credit.  Instead, I want a "debit" card.  This is what you
    refer to as "convenience" usage of a credit card.  I choose VISA
    because it's the most universally accepted.  Whether I get my VISA from
    DCU or SEARS, or anybody else depends on "the deal".  Who's got the
    best deal?
    
    Every month, I go down to my friendly branch office and move money from
    Savings to pay off my VISA account.  If I could get you guys to
    "automagically" do that for me, then you would have the best deal (in
    my opinion).
    
    Mark

    
    I believe the current implementation of a fee on DCU credit cards is
    working against DCU in many ways, given current market conditions in
    the credit card arena.  The fee is a penalty fee, not a user fee.  I
    have a hard time swallowing the belief that a person with $1500 savings
    and a $5000 used car loan has no relationship with DCU.  It would be
    more adequately termed, insufficient relationship.  Thus they are being
    penalized for this with an annual fee.  All the time that no-fee cards
    are readily available.
    
    Makes absolutely no business sense to me.  I will document more later.

	There is a real good point in .42 - an added value that DEFCU
	could supply is convenience. There could be a field in the
	database that might indicate that the DEFCU should take one
	of the following actions each billing period:

		1) Pay off the entire balance from account xx (savings, 
		   checking, RSVP, whatever). This is for folks who
		   always pay off their balance each month.

		2) Pay $YY from account xx, or the full balance, whichever
		   is smaller, or the minimum payment, if that is greater
		   than the smaller of the other two. This is for folks who 
		   want to budget a specific amount each month.

		3) I'll send you a check. This is what most of us are used to.

	Not only would we benefit as consumers (save the time of writing
	a check, cost of stamp, possibility of forgetting to pay on time)
	but the DEFCU would reap a reduction in the number of VISA payments
	that would have to be manually processed, and would get the money 
	due it on a predictable schedule (similar to the benefits DEFCU
	currently reaps from direct deposit of paychecks).

	If such a service was offered as part of a no-annual fee credit 
	card, the convenience of not having to write a check or remember 
	to mail the thing would probably prompt me to forget the other 
	credit cards I now have.

						Tom_K
	

Re: .39 <DZIGN::DAWKINS> 

Tanya, thanks for adding some clarity and focus to the discussion!

>>	DCU members will have their Annual DCU Credit Card fee
>>	waived if they fall within one of the four groupings below:

The ways to get a fee waived are beneficial, but they are benefits to the 
DCU, and not to individual members!

>>	1)  They maintain $3500 in savings at DCU

I don't have much in savings right now.  With interest rates so low, I am
using most of my savings, which draws 3% interest, to pay off debt which is
at 9% or above.

>>	2)  They have $6,000 outstanding in DCU loans

Well, with the current tax structure, regular loans are not fiscally
responsible, because the interest is not tax deductible.  I do not have,
nor will I have, such a loan.

>>	3)  New card holders (for the first year)

This is nice, and easy, but the joy doesn't last long!  :-)

>>	4)  Members that obtained a DCU mortgage loan that was sold.

DCU couldn't help me here, either.  I have two mortgages, one for a rental
property that I would like to refinance, and one which is a land/construction/
mortgage loan.

>>	Thus, the pricing of this product encourages you to maintain
>>	a relationship with the DCU.  I think that's a good policy.
>>    	My understanding is that over 90% of of deposit accounts and 
>>      85% of the loan accounts meet this criteria, thus, fee income 
>>      from DCU credit cards is minimal.

In my current situation, I could have a pretty good relationship with the
DCU if I could make charges of $5,000 a year or more on a Visa card which
has no annual fee.  I wish DCU would add the following:

	5)  Members that charge more than $x,xxx per year.

Until I see this, or my desire for interest on all checking balances with
Direct Deposit, I'll just use DCU for petty cash.

Elaine

    re: .39
    
    >	1)  They maintain $3500 in savings at DCU
    
    Why would I want to do that when my nearest DCU branch is 1,000 miles
    away?
    
    >	2)  They have $6,000 outstanding in DCU loans
    
    Hah!  Why should I get a loan from DCU when DCU makes it so difficult
    to do so?  When we got our loan for the Infiniti, I went thru a
    different credit union than the one we were using for the loan on the
    Mazda.  When the CU that had the Mazda loan found out that we had used
    another CU for the Infiniti, they offered to beat the other CU rate by
    1% if we would transfer the loan to them.  Would DCU do that to keep a
    customer...dream on!
    
    >	3)  New card holders (for the first year)
    
    That's an idea.  Maybe I should cancel the DCU card each December and
    reapply each January.  Of course, I don't see how DCU is going to make
    any money processing my credit application every year.
    
    >	4)  Members that obtained a DCU mortgage loan that was sold
    
    GRRRRRR! DCU doesn't even make mortgage loans in most states, including
    mine.  This simply shows the New England-centric orientation of DCU.
    
    >	Thus, the pricing of this product encourages you to maintain
    >	a relationship with the DCU.  I think that's a good policy.
    
    DCU hasn't given me any reason to establish, let alone maintain, a
    relationship with them.  The pricing of the product encourages me to
    take my business somewhere else that values customers.
    
    Bob
    
    
    
    

    re: .48
    
    >Actually, they recently ran a promotion which essentially did just
    >that.  And you didn't have to finance another car to get it.
    
    What promotion was that?  Was a credit check required?
    
    >DCU sells off it's mortgages.  I would imagine that the restrictions
    >are externally imposed.
    
    I don't know.  Does any of the BoD know why DCU doesn't offer mortgages
    in all 50 states?
    
    Bob
    

>    What promotion was that?

	Probably the one talked about in topic 586.

				Tom_K

    
    Early returns seem to indicate that 'convenience users' are better
    termed 'cash-substitute users'.  While these users tend to pay off
    their balance every month, the yearly charge amounts are fairly
    substantial.  $5000 seems pretty typical, some lower, some higher.
    
    If DCU were lure 30,000 of these cardholders, it would stand to
    make $2,100,000 (30000*5000*.014) in interchange income alone.  Now,
    I'm sure there are going to be occassional losses (although not as high
    a likelyhood as with a rollover customer), expenses, etc.  But some of
    these 'cash-substitute users' will occassionally contribute interest
    income as well.  
    
    It certainly seems there is money to be made in this market.  Maybe
    that is what all the other places offering no annual fee cards have
    realized?  A token $20 fee may be giving $50 to their competitors.
    
    The more you look at this the more you want to start a credit card
    business!  Come to think of it, maybe that's exactly what brought 
    GE & GMC into the market.
    
    Comments?  Am I missing something here?  

    As one of the previous replier's mentioned, I too, would like to have a
    debit card rather than a credit card.  When I had a DCU VISA card,
    that's exactly how I used it, as a convenient substitute for cash &
    checks.  However, I gave up the card when DCU started charging fees.

    I believe some other banks in NE offer this service (Baybank for one?).
    You get what looks like and is accepted by merchants as a VISA or
    MasterCard, but the amount of your purchases is deducted from a
    designated account of yours as soon as the charge gets back to your
    bank.  So, you don't get a separate billing for your card, the entries
    simply appear in your regular statement.

    It seems to me that this type of scheme could save the DCU costs in
    billing, etc. and would give the convenience users what they want.

    Besides, you could still have a line of credit even with a debit card
    by having a reserve account that would "loan" you money if your regular
    account couldn't cover a check or a charge you made. So, DCU could make
    money from the convenience user who occasionally has a blip in his/her
    spending habits.

    I don't know why debit cards haven't really caught on.  I've seen where
    you could use a few (Baybank again) at gas stations and grocery stores.
    The debit card masquerading as a VISA or MasterCard is one way around
    the problem, since most merchants accept them and they get paid the
    same way.

    Bruce

  Debit cards haven't caught on because you can't win on the float.  I
see no real advantage to a debit card when I can use a credit card and
play the float game.

    A second reason is protection under federal law.  Under federal law,
    the most you can loose if your credit card gets stolen is $50. Since a
    debit card is NOT a credit card, you stand to loose your entire
    balance.
    
    Gim

On the topic of annual fees -

when are they charged??

On the topic of Credit Card Costs -

Why, when I haven't charged anything to my DCU Visa in over 6 months, and have
no outstanding balance, do I get a statement every single month telling me this?

No other credit card I have used sends you a statement when there is no amount 
due and no payment has been recieved.

As far as credit card useage, about 300$ a month on average, with some months 
hitting well into the 1000$ range (happens at least twice a year, hopefully no
more than 4 times...) so the yearly average is around 5000$, and I try to pay
off as fast as possible...

grins,

clark.

    
    >when are they charged??

    Charges for Jan-Dec 1992 will appear on your Feb. 1993 statement.
    (info compliments of the DCU info center)
    
    >Why, when I haven't charged anything to my DCU Visa in over 6 months, 
    >and have no outstanding balance, do I get a statement every single month 
    >telling me this?
    >No other credit card I have used sends you a statement when there is no 
    >amount due and no payment has been recieved.
    
    Groan...  I will ask about this and see if this waste can be stopped.
    
    >As far as credit card useage, about 300$ a month on average, with some 
    >months hitting well into the 1000$ range (happens at least twice a year, 
    >hopefully no more than 4 times...) so the yearly average is around 
    >5000$, and I try to pay off as fast as possible...
    
    Your usage is fairly typical (from what I have seen so far).
    

    
    One interesting item of note:
    
    When people disclosed their credit card usage I was surprised to see
    that almost all also used the Discover card to receive 1% back on 
    purchases whenever they could.  It appears that credit card companies
    have attempted to counter this feature with various bonus points
    features, gift certificates, etc.
    
    Well, it was bound to happen.  Just this past weekend I was solicited
    yet again for a VISA credit card.  But this one definitely caught my eye. 
    No annual fee and 1% cash back on purchases (2% at certain clothing
    stores, 5% for travel arranged through a certain place).  The
    application is already in the mail.
    
    The card was being offered through a bank in Delaware by Petite
    Sophisticates.  Don't ask me how they got my name but I'm glad they
    did.  It appears many more players are coming into the credit card
    arena and trying to capture competitors card holders.  Others will have
    to adapt to remain competitive and keep their customers.
    

       Those banks like Citibank give 'bonusus' called Citidollars, etc.
    What a deal those are! For $400 cash and a few hundred 'Citidollars'
    you can buy a $300 TV!
                                       Denny

    Yeah, Denny, and if you don't pay off your balance every month they hit
    you with an 18-20% interest charge.
    
    Phil, I'd be surprised if your survey of credit card holders is typical
    of the majority.  There is alot of money being made on interest
    payments, otherwise more card issuers would be operating like American
    Express.  Even AmEx got into the revolving charge business with their
    Optima Card.

	I agree with Macneal.

	Those who pay off their card balances each month are probably
	proud to make that boast. But how many of those struggling
	with a large balance will care to make that admission?
	Even anonymously?

					Tom_K

I have a Citibank Advantage Visa Card.  Here are some of the
benefits:

1.  one mile on American Airline for each Dollar charged.

    AA gives one free ticket for 20,000 miles. Assuming a round
    trip ticket costs about $350, this is equivalent to a 
    rebate of about 1.75%. 


2.  Price protection for up to $250.  Last year I purchased a
    printer for my PC.  I saw it advertized for $50 less. 
    Sent the ad to Citibank and they credited my account for
    the amount.  Same situation for a camera. I purchased the
    camera for my wife at Christmas.  A week later it went on 
    sale for $10 less. 

3.  One year extended warranty.  We recently purchased some
    mew kitchen appliances. I do put value on the additional
    year of warranty.

4.  The card has a $50 fee.  Last year I called and asked about
    having the fee waived.  They say they don't waive fees.  
    I pressed them about the matter and after speaking to a 
    supervisor, they said they would send me a $50 gift certificate -
    but they won't waive the fee.

Note: I was amazed at the amount of information on me.  Citibank
was able to give a year to date as well as a lifetime to date
charge history. I've had the card for 5 years and have paid
zero finance charges.


Gim

One of my current charge cards just dropped their annual fee altogether.  They
used to charge a fee based on usage (higher usage = lower fee).  I think the 
DCU would be well served to closely examine the charge card trends.

Jilly

    
    
      I have a Navy Federal Credit union card.
    
      No annual fee,  and 12.5% interest rate.  (It's never been above
    14%,  ever...)
    
    Citibank and discover can keep their gimmics...
    				
    
    						-al
    

    
    RE: .60 & .61
    
    I understand I will be receiving a small sample.  I specifically
    asked for people who pay off their balance each month and not rollover
    types because I wanted to try and see just how much people were
    charging per year.  

    
    My USAA Gold MasterCard sends a quarterly Newsletter. In this quaters
    news letter, there is a column about where the USAA card stands with
    respect to other cards (table follows).  How does DCU compare to this?
    (NOTE: This is for a Gold card).
    
    FWIW: DCU would not give me a Gold card without first applying for a
    regular card and then completely re-applying for the Gold card.  USAA
    did not require any of this.  This is another reason why I don't use my
    DCU card to often (as little as possible).
    
    Jon.
    
    
    		USAA Gold	The GM		GE Rewards	AT&T Universal
    		MasterCard	Card		Gold Card	Gold*
    --------------------------------------------------------------------------
    Interest	12.5 APR	16.4 APR	14.9 APR	15.9 APR
    Rate	variable	variable	variable	variable
    --------------------------------------------------------------------------
    Annual Fee	$20		None		$40		$40
    --------------------------------------------------------------------------
    Late Fee	None		$10		$0-15		$10
    --------------------------------------------------------------------------
    ATM/Cash	No		2%; $2		2%; $20		2.5%; $20
    Advance	Additional	minimum.	maximum.	maximum.
    Fee		Fee		Convenience	(No grace	(25-day grace
    		(No grace	Checks: 1%	period)		period)
    		period)		$1 minimum.	
    				(No grace	
    				period)
    --------------------------------------------------------------------------
    Returned	None		$10		$0-15		$10
    Check
    Charge
    --------------------------------------------------------------------------
    *Charter members: 14.9 APR; no annual fee.
    Above information is current as of 10/1/92.

1)  I am going to apply for a DCU card, but I will cancel it if a
time comes when I am asked to pay an annual fee.  My money at the
DCU is spread out into multiple accounts (wife and kids) and I'm
not sure if I'll qualify for the exemption once my car loan is
paid down.

2)  I agree with the philosophy of charging a credit card fee to
people whose relationship with the DCU doesn't benefit the DCU.
However, I think charge volume should be another basis for
waiving the annual fee.  I'm pretty sure I'd make money for the
DCU, even though I am a "convenience" user who only pays interest 
when I misplace the bill.

3)  Debit cards are not as good as credit cards, since credit
cards provide specific legal protections, e.g. when the charged
merchandise is defective or when the card is lost or stolen.  I
think it's foolish to let anyone do an EFT of your money unless
there are legal protections similar to those currently available
only for credit cards.  

4)  I think it's a good idea for Phil to poll people for their
charge habits, in addition to the DCU checking its files.  This
catches people like me, who have never had a DCU charge card.

5)  For the most part, I'm not interested in convenience features
in my credit card -- just in having no annual fee and having a
reasonable late payment fee.  But I would love an automatic
payment feature.  Also, the AT&T card covers rental car collision 
insurance, which saved me $9/day this past vacation.

	Enjoy,
	Larry

    
    >But I would love an automatic payment feature...
    
      I think DCU offers this.  I remember seeing a flyer announcing
    	that you could either have the Minimum or entire balance
    	automatically paid if you so desired.
    
    						-al
    

    
    
      BTW,  speaking about Visa DEBIT cards,  how do "approval
    	authorizations"  work?
    
      I've noticed that Credit card "authorizations"  essentially 
    block out a portion of your available credit  until the charge
    is actually processed.
    
      This is no big deal when you buy something where the price 
    is known,  but in cases where the card is presented in advance,
    merchants make sure they authorize an amount much larger than
    the actual charge will be.  (I.e.  I rented a car "overnight"
    in New Jersey in September - The Rental agency  processed an
    "authorization" for $400   for what amounted to a $49 rental.
    
      Likewise I once bought a TV at lechmere.  The first time through
    the authorization apparantly timed out (christmas season)  so they
    ran it through again.  Checking my 'available credit'  via the 
    touch_tone teller,  I noticed that what was "set aside"  was 
    actually _DOUBLE_  the amount of the TV.  (Only one authorization
    was "recieved"  but 2 were granted...)
    
      These authorizations expire at the end of 3 working days,  or
    when the actual charge gets processed,  and it's no big deal 
    as long as you have a sufficiently high credit limit.
    
      My question is,  how does an authorization work on a Debit
    card?    If I check into a hotel for an overnight stay,  and
    the merchant submits an authorization   ~$400  (which is common  
    - that way I can stay an extra day with no more paperwork),
    what then happens to the available balance in my bank account?
    Do I suddenly "lose"  access to $400  until the hotel charge
    clears?   What happens to incoming checks during that time?
    
    
    						-al
    

    Al, you're right!  When I read your reply, I went down and checked at
    the branch.  Rose gave me a "automatic loan payment transfer
    authorization" card to fill out.  You can check the box "MONTHLY
    AUTOMATIC TRANSFER" and the minimum balance is paid, or you can check
    "MONTHLY VISA PAYOFF".
    
    Thanks DCU,
    
    Mark

    *	Automatic payments don't let you play with the float.
    
    *	If you pay off you balance each month, DISCOVER is the best
    	card to use (where accepted).  You get cash back.  Cash.  Not
    	vouchers or CitiDollars or airline miles.  Cash.  (Actually,
    	the airline miles can be a better deal than cash %-age wise
    	as someone showed in a previous reply, but that privelege
    	requires an annual fee and therefore a hefty amount of usage
    	to break even.)  DISCOVER charges no annual fee.

    	A recent credit card pre-approval (VISA or MC, my choice) that 
    	came through my mailbox offered a 1% refund.  I had to read the
    	fine print.  I get the refund only on the amount that I carry as
    	a balance.  If I pay off the card each month, no refund.  Interest
    	rate was 18%.  Thanks alot.  I threw it in the trash.

    Just called my MBNA gold Master Card and got the annual fee waived.
    They'll get rewarded with extra heavy use in '93.
    
    Coulda... shoulda been the DCU, but no, nobody gets their fee waived,
    no matter how much the charge.  Idiots.
    

I just got my December statement without a 30-day fee alert (as described
on the back).  Is it coming in January?  Does it come under separate cover?
Or should I check with my "household" to see if they qualified me for a
fee waiver while I wasn't looking?  Thanks.
\Joe

	Update to .66

	USAA just dropped (perminently) the annual fee.  DCU where are
	you?

	~Jon.

RE: Note 608.76 by FASTER::BELANGER 

>	USAA just dropped (perminently) the annual fee.  DCU where are
>	you?

I have not been charged for the card, since I have been a member
(couple years...).  

	- mark

    
    
    Question for DCU members and readership...Are there any charge cards
    out there that do not charge you an annual fee based on maintaining
    a certain level of purchasing activity?  If so, who offers them and 
    what is the required level?

	AT&T has no annual fee if the card is used 1 time per year!

	I have also experienced card issuers waiving the fee when I 
	tell them I have another card with a better rate.  Note,
	at one time,  the DCU visa had a great rate compared to other 
	banks, but that is nolonger true.  It is important that DCU 
	consider making agjustments to return the DCU Visa to be best 
	( or atleast competitive ) around.

	-bill

There are half a dozen cards out there that do not charge you an annual fee
based on maintaining any level of purchasing activity. That is why I do not
use my DCU visa card anymore. I switched to a card from Armed Forces Benefit
Association. You do not even have to be a member of the armed forces to join.

All you have to do is to have a good credit rating. And if you leave a balance
on the card, you are only charged 11.5% interest.

You are making it very hard for me to use the DCU card anymore.

One DCU members input.

Thanks for listening.

Have a nice day!

Dave

The new GM mastercard doens't have an annual fee, as well as the 5% toward any
new GM car that you might buy (up to $500/year, can accumulate for several
years)


-bill

Maybe a good place to start this type of research would be one of the recent
editions of Money magazine (sorry, don't remember which issue right now). 
They had an article which discussed which card was right for you, based on
your credit rating, usage habits, whether you maintained a balance, card
features, etc.  They had phone #'s too.

My DISCOVER card doesn't charge an annual fee; and recently they've done
something rather interesting - the more purchase activity on the card, the
lower the interest; there is no balance requirement.

And as noted, the AT&T card (btw; they were rated one of the best in customer
service).

--Scott

As been mentioned - USAA Gold card used to waive fee's if you charged more than 
1k a year, now there is no fee. The annual interest rate is 12.5%.

Baybanks has droped all fees for my Visa and Mastercard for last year (40 or
50$ savings for me per year) and I didn't use either card at all in 1992.  
Because they dropped the fees, I am now using them.  Anual interest rate is 
14.5% on these two (non gold).

I expect that come sometime this month, my DCU visa will be cut up... :-(

grins,

clark.

    I just got a VISA card from some bank in Ohio that is no annual fee.
    It has an interest rate of around 15%, and doesn't require any minimal
    activity.  
    
    I may have the interest rate figure wrong;  since I'm one of these
    "convenience users" who pay off each month, I don't worry about the
    interest rates as much.
    
    I expect to cancel my DCU VISA card as soon as they attempt to charge
    me an annual fee.  I'd rather continue with the DCU card, but it's 
    stupid for me to do that if I can get it cheaper elsewhere.
    
    
      Scott

    I have had a VISA GOLD card from Bank One, Columbus (Banc One
    Corporation) for a couple of years now.  The only requirement for no
    annual fee is, it must be used at least once a year (which is no
    problem for me!)

    I don't have a clue what the interest rate is, because I pay the bill
    off every month so I don't care what it is.

    I liked the convenience of paying off the DCU VISA bill via Easy-Touch,
    but the change in requirements (even though I still qualify for a no
    fee card) drove me away from DCU.  Reason being, who knows what the
    requirements will be next year.  Bank One guaranteed, use once-no fee,
    *period*.  No convoluted "if you keep X number of dollars in X, Y, or Z
    accounts, OR you have X number of dollars in loans outstanding OR you
    charge X number of dollars per year, etc." 

    Since getting the BANK ONE card, DCU has lost a considerable amount of
    charges, but since I don't carry a balance, they probably don't want my
    business anyway.

    -Bob
                                               

    I have a Gold card from another credit union that has no annual fee, a
    grace period similar to DCUs (25 or 28 days, I don't remember which),
    and a lower interest rate.
    
    Bob - getting the scissors out for my DCU card.

    Re .all
    
    I too have an ATT no charge card. I used to have a Baybank card. As
    soon as I was offered the ATT card for lifetime no annual fee out went
    the Baybank card. I too would get a credit card from DCU if there was
    no fee. I don't care what the interest rate is. Charge 25% a year if
    you like I pay it off every month. Reason I'd get a DCU card is due
    to the convenience of paying it off each month. Would also save me the
    29c stamp as well as the fact by using Easytouch I could better play
    the float by paying it off on next to the last day allowed before
    interest charges kicked in.
    
    Interestingly enough I'd want a Mastercard not a Visa card. I've always
    used Mastercard and for some reason I wouldn't want a Visa.
    
    Dave

    
    
      My Navy Federal Credit union card  has no fee (never did!)  
    	regardless of whether it's used or not,  and they just lowered
    	the interest rate (for the second time in a year) from 12.5%
    	to 11.9%.  (It's never been above 14%,  even back in the jimmy
    	carter days of high interest rates.)
    
    
    						-al
    

Tanya --

	I own 2 VISA cards - DCU and ATT.  I used to use the DCU card very 
heavily and charge once on the ATT card each year (just to keep it alive).  As 
soon as DCU announced that they were going to start charging an annual fee I 
put the DCU card in a drawer and switched to the ATT card.  

	The bottom line is:

		Wnen I receive a bill for my DCU VISA I plan to cut
		it in half.

		If DCU would eliminate the annual fee, I would put the
		ATT card back in the drawer and use the DCU VISA 
		exclusively.

	We use our VISA card a lot.  All things being equal (i.e. no annual 
fees) I'd rather see the merchant fees go to DCU.  However, I am not willing 
to pay a premium for this.


							Gary Hicks

    You can have the fee waived for the DCU Visa card!

re - .92 :

Do you know something the rest of us are missing??

yes you can have the fee waived, if you have x thousands of dollars in the dcu,
or y thousands of dollars in outstanding loan balances.

Big deal, and thanks alot dcu...

grins,

clark.

re: .92

Why jump thru all the hoops that DCU wants when there are other credit unions
willing to give me a no-fee card with no strings attached?  I've got better
things to do than play games with DCU.

If DCU wants my business, they will make it easy to do business with them.

Bob

I like the DCU.

I applied for a VISA card 2 weeks after I become an employee.
A month later (at least as I remember it that's how long it
took), I was informed that I had to be a DEC employee at
least 6 months to be eligible for a card.  This was the
first that this was mentioned.  STRIKE 1.

I applied again at 6-1/2 months employment (filling out a whole
new application).  A week later I get a call saying that I was
turned down for the Gold card (5,000 credit limit).  Reason?  
I had changed jobs and moved in the past 7 months.  Well, pardon
me, but I didn't think working at Digital was such a detriment.
I was in my previous job over 7 years.  I have an unblemished
credit rating.  I had credit cards with a 5,000 limit and new
cards (at least one per month) begging me to sign up.  I took
DCU's offer for a regular card and a $3,000 credit limit (a
credit limit that I never come close to using).  STRIKE 2.

DCU announced that the annual fee structure would be changed.
I don't believe in paying annual fees when there is no need to.
I currently have cards that not only don't require annual fees,
but that give me free collision damage waiver, 90 due purchase
loss/theft/damage guarantee and other benefits.  A month before
the December bill that would charge a fee, I cut up my card and
sent a letter to DCU cancelling my card.  I had stopped using it
a few months earlier in expectation of this event.  STRIKE 3.

I have since received a mortgage through DCU (that was not handled
particularly well) and, if I understand the requirements correctly,
this qualifies me for a no-fee card.  I have no desire to apply for
a card from DCU - and I want our credit union to succeed and be
profitable.  I continue to receive regular offers from other
institutions (and in fact have one on my desk at home that I'm
considering).  I really don't need more credit cards now (actually,
we get by quite well with just 2 in active use) but DCU is simply
uncompetitive, at least for those who have good credit.  I have 
never had a hassle with any other VISA/MC institution (American 
Express is another story :-) ).

From my perspective, a straight no-fee card has got to make good
business sense for DCU - but I have no access to figures.  It makes
sense to a *lot* of other companies that offer credit cards and they
are raking in the business.  When it comes time to charge, I simply
decide whether I want cash back (Discover) or insurance rental waiver
or item protection (MC).

When I had a DCU card, it was the card of choice.  It just doesn't
make sense to use it today even if I had it.

Collis

Citibank offers two cards that can't be beat:

1.  an VISA/Mastercard tied in with American Airlines that gives
    you one mile for each dollar charged or

2.  a Dividend Option that gives you 1.5% of your charges back with
    a limit of $1000 in cash back each year.  This option is NOT
    available for new accounts. You have to be a member in good
    standing for this option.  This beats the SEARS Discover card
    by a mile. 


In both cases, the annual can be waiver if you ask them. If you ask
them, they'll say they don't waiver their fee. Technically they
are correct. They will give a gift certificate equal to the fee.

You can call Citibank at 800-335-2222.

Gim

re: .96

If they give me a gift certificate I have to spend with them, they haven't
waived the fee.

If I can do with it as I please, then it might be an acceptable idea.

Frequent flier miles on AA doesn't interest me since AA miles expire after 2
years.  Other airlines miles don't.

Bob

    
    My bank's Gold MasterCard has two options:
    
    	o No annual fee and an interest rate of x% (can't remember what it
    	  is)
    
    	o An annual fee but a lower interest rate
    
    You can elect either option.  Since I almost always pay it off in full
    every month, I chose the no annual fee option.  There is no required
    activity threshold either.
    
    Lou
    

Through AAA I have a MasterCard with no annual fee for as long as 
I let them charge my AAA membership fee to it.

I also have some other credit cards at least one of which I'll
not renew unless they drop the annual fee. 

I never applied for the DCU VISA because I read the fine print in 
the initial offering.  I strongly suspected the rules would 
change after the first year and didn't want the hassle of 
cancelling the card or even the increase in blood pressure the 
eventual change (fee increase) would cause.  They've never been 
competitive enough since to take my business from the other
suppliers. 


Maryellen

    I have a regular Mastercard from another credit union that charges no
    annual fee, 28 days grace period, and 2 different interest rates
    depending on your credit rating- A is 10% and B is 11.5%. I have not
    found anything to beat it.

    
    RE: .95
    
    Collis, it has been acknowledged that there have been problems at DCU
    in the past concerning loan approval (credit cards ARE loan
    approvals).  Changes HAVE been made in this area and things are
    definitely looking UP.  Please give DCU another chance and see if what
    I say is true.  Others should also IMO.
    
    Also, please remember that as members of DCU you have the right to
    appeal ANY loan denial to the Credit Appeals Comm.  This includes
    credit card denials.
    
    Things ARE changing at DCU.  Maybe not as fast as you would like to see
    them change, but they are changing.  We need members to come back to
    DCU and do business.  If you encounter problems, then we need to hear
    about them so we can continue the improvement process.  But please
    let's try and let go of the past bad experiences to a certain degree.
    Judge DCU on its performance TODAY.  I can only work on improving that. 
    YOU must work on leaving the past behind.  I can't help there....
    

Phil,

If DCU put out a competitive card, I would apply for it despite
the past aggravations.  However, partially because of the past
aggravations, I will not give up benefits that I use from other
credit card institutions in order to use a DCU credit card.
I expect most members are less forgiving than I.  I still like
the DCU and want to support it.

Collis

Here is a copy of the note that I sent to Chuck when I cancelled my VISA Gold
Card.

						March 19, 1993
Mr. Chuck Cockburn
President
Digital Credit Union
P.O. Box 130
Maynard, MA  01754-0130

Mr. Cockburn -

My wife and I have two VISA Gold Cards.  One is from DCU and the other is from 
AT+T.  Because we have a large family, we charge several thousand dollars on 
VISA each year.  We used to use our DCU VISA card exclusively so that our 
credit union would benefit from the transaction fees.  However, when DCU 
announced that it would impose an annual fee to those members that do not have 
a "household relationship", we decided to switch to using our AT+T VISA.

In short, all other things being equal, we would like to use the DCU VISA 
card.  However, it does not make sense to us to pay $25 for this privilege 
when there are many other vendors that do not charge an annual fee.  

Enclosed please find our DCU VISA Gold Cards.  I would appreciate it if you 
would cancel our VISA account.  If our credit union changes the current policy 
of charging an annual fee, we will consider reapplying.


						Sincerely,



						Gary and Sarah Hicks
						405 England Place
						Marietta, GA   30066

For those who want a lower interest rate on a MasterCard:

	o 9.6% on all purchases and cash advances
	o First year free ($12 per year thereafter)
	o A long term CD for 3-5 years will cause the annual fee to be
	  waived.
	o No fee for Cash advances (interest starts right away though)
	o Interest is compounded daily
	o 25 day grace period
	o Over the credit limit fee $10
	o Previous rate was 12%
	o No Gold card
	o Maximum of $5,000
	o Must work OR live in New Hampshire to become member
	  of GSCU.
	o Insured by NCUA

	Asked if this was a teaser rate and was told no.  They planned
	on leaving it at this rate for as long as interest rates remain
	low.  They had been at 12% for a while.

	(800)446-0285

	Granite State Creddit Union
	P.O. Box 6420
	464 Chestnut Street
	Manchester, NH 03108

    Got the DCU VISA statement recently, it said "Your annual fee has been
    waived."  I've authorized the credit union to pay off the balance each
    month, so I don't pay any interest either.
    
    I say, "Thanks, DCU VISA."
    
    Mark

    I didn't know where to put this, so I decided to attach this to an
    existing VISA note.
    
    Overall I have been happy with my DCU VISA cards.  I have had a few
    problems paying both with one check, but DCU has been very cooperative
    about straightening out the problems.
    
    I just had an interesting experience, though, and I'm wondering if this
    is correct, or standard practice in the business:
    
    My wife tried to charge something and found that her card bounced. 
    Our review showed that she should have had sufficient balance for the
    charge.  However, apparently there was an extra 'hold' on her account
    that put her over the limit.
    
    To use relatively real numbers (not real):
    
       The current statement, received a couple of day before, was 700. 
    Her limit is $1000.  She charged $200.50.  The clerk at the store
    checked the account for $200.00, putting a 'hold' on the account for
    $200.00.  The $200.50 charge hit the books, putting her over the limit.
    Why?  Because the $200.00 'hold' did not match the $200.50 charge
    exactly! Therefore she had $400.50 'apparently' added to her $700
    balance, over the limit! 
    
    Why aren't the 'holds' and charges matched by authorization code, not
    the exact amount?  Are we expected to watch the clerks at stores so
    closely so they enter the EXACT amount.  There's got to be a better
    way.
    
        Jeff 

re:  last 

I had precisely the same thing happen with my Ford Visa, so I don't
think this is something specific to DCU.  I found that calling the
merchant straightened things out.  In my case, I was doing business
with a mail order high performance tire reseller, and everything was
on the computer, so it was easy to straighten out.  Your milage may
vary if the vendor is less sophisticated.

This would seem to be a systemic problem with the whole charge car
system, rather than a quirk with DCU.

Chris

    
    
      This happens a lot where they 'swipe' the card through
    the reader 2 or 3 times, before the first authorization
    number comes back...
    
     It doesn't appear to be specifically DCU related...
    
     Also,  hotels and car rental companies will sometimes reserve
    a huge ($500 for a 1 day rental?) block of available credit
    at check-in time.   It's amazing what you can discover with
    a Touch-tone balance checking system...
    
    
    						-al
    

    This is one of the reasons I have multiple cards from multiple issuers
    and I make sure I use all the cards on a regular basis.  For example,
    on a trip, I will charge the rental car on one card, the hotel on
    another, and meals, etc on a third.
    
    Bob

    So you're swapping a Visa card with an 11.9% rate for one with a 14.5%
    rate?

  >I'm sorry you took my question so personally. 

    
    One question:  Why waste time letting Keith rat-hole yet another topic?

    	You know there was another person in another conference that had a
    noting stile similar to Keith's and I believe somebody in the
    conference set up a note that people singed up in saying they would no
    longer respond to that person.  This saved a lot of grief for the
    noting community and the different topics weren't ratholed anymore.
    Now I'm not advocating that we do this here I'm just reporting what
    went on in another conference that I occasionally read and how they
    dealt with what they saw as a problem.

    Joe

    > "If you don't have anything nice to say - don't say anything"
    
    Ah, but then there would be no DCU conference. :-)
    

    Let's look at this latest string, shall we?  I asked a question.  After
    asking that question I have been attacked by at least 3 different
    noters.  

    gosh yes, and only Collis and I used smiley-faces, so I guess all you
    are deadly serious about the topic.  :-)
    
    Mark
    
    ps.  I'm tired of people that say "lighten up", but aren't very light
    themselves.

    >> "If you don't have anything nice to say - don't say anything"
    >
    >Ah, but then there would be no DCU conference. :-)
    
    Exactly!
    
    -Glenn-
    

It's true, Keith, that people have been (in my opinion)
unfairly harsh with you in this latest exchange.  Sometimes
that's just a part of being active in notes.

When this happens to me, I find that short-term memory
(forgetting that it happened) and a different focus
(finding positive things that I can encourage others
about) work wonders.

Collis

    In regard to interest rates on credit cards, I am getting offers for
    the same deals. 10.9% to pay off other cards for as long as it takes to
    pay the balance off. 
    
    Why can't DCU offer these deals? Why aren't our VISA cards offered at
    2%-3% + prime or even better 2-3% above the 1 year T-bill rate adjusted
    on a quarterly basis (based on average sale price of the previous 3
    months)? We could offer savings rates 1% above the T-bill rate and
    still make money. I mean, this seems to give DCU a good profit and also
    serve the membership. IMHO, a deal like this would have people banging
    down DCU's doors to get a VISA card irrespective of any annual fee.
    13.5% and 11.9% don't compare to the really good cards. 
    
    I guess I'm on the bandwagon of the rates serving the membership. I
    want deals where we get money and lend money and generate revenue. 

	I received an offer in the mail on Saturday - no fee; 6.9% on
transferred balances; 11.9% on new purchases.

	What was the catch - no grace period.

						--Doug

    Why did you toss it? Did it indicate a time when the 6.9% would be
    increased? Or was the 6.9% for as long as it took to pay off the
    transferred balance?

    I expect he tossed it because no one today (that I know) consciously
    chooses a card that has no grace period (i.e. you start paying
    interest from the moment of purchase).
    
    I just accepted another pre-approved card that charges 4.9% interest on
    transferred balances through October.  Due to my recent refinancing
    (not through DCU since their rates were literally .5% higher), I've
    had to pay a few minimum's and even borrow some cash until escrow
    money is returned, etc.  
    
    I don't really expect DCU to always be the best (I think that what
    I got is an outstanding deal).  But I do believe they can be better
    than they are.
    
    Collis

	I tossed it because:

	1) I have not paid a penny in interest on any of my cards in the
last three years or so despite running $2-8k through each of them.

	2) I have no balances to transfer, thus 6.9% does me no good, and a
no grace period card is not in my interest given 1) above.


	The marketing literture with this offer talked about how this was an
advantage for people who carried balances.  It reminded me of the "more choices"
brouchure - trying to make a negative attribute look like a benefit.


						--Doug

    
    If it is the same one I got in the mail 6.9% it was from the Bank of
    New York. It does have grace period (I am actually looking at it now)
    25 days ..no cash fees, no annual fees..
    
    however the rate is good through September 14, 1994 after which you pay
    12.9% (Maybe it is a different offering).
    
    Why would you take the 6.9 for only less than 6 months, when you can 
    get 8.9 or 9.0% for the duration of the transferred balance..
    
    Still 12.9% beats DCU's rate (sorry ..couldn't resist..:-) )
    
    

	Nope, not the same one.  This one definitely had no grace period.  It
toutd that as a "feature" in the literature, and it was clearly stated in the
disclosure box on the back.

						--Doug

      There is something wrong with :-1
    
    Are you suggesting that GE VISA is going to give me $1400  after
    spending $10,000???  That is a return of ( 1400./10,000=.14 )
    14% 
    
    Perhaps you receive $1400 after spending the total of the left
    column.  Which  would make  the equation ( 1400./22,000=.063 )
    or 6.3%  which  is more  believable.
    
    Regards,
    Ben

In general, I chuck away any invitation for VISA/Mastercard.
The invitation for the GE VISA card piqued my interest.
Other DCU members may be interested:

Main Feature: real cash back at the end of the year (no certificates
but a real check). The rebate schedule is as follows:

        0 - $2,000      0.5%            $  10 
    2,001 -  4,000      1.0%               20 
    4,001 -  6,000      1.5%               30 
    6,001 - 10,000      2.0%               80 
                                        ----- 
                                        $ 140 

The figures above are based on annual charge dollars.

Interest rate for those who have a balance is in the 17-19% range.
The Wall Street Journal recently had a article explaining how to get around
the rate.  You basically pay off the  GE card with another VISA
card that has a lower rate.

I personally would like to see a lower price on my purchases for cash
payment.  (Don't kid yourself.  The cost for accepting VISA/Mastercard
is built into the price.) But it seems that trend is to accept
VISA/MASTERCARD very where! But with deals like this, people who have
the financial displine can be $140 richer.

Now if I could only charge my business trips to this card!

Gim

re .-2
 There is only a GE Mastercard.  I called them and I now have one.  They do
NOT have a rewards program for VISA.

I recently received a notice that DCU will be decreasing its interest
charge on credit cards!!!  This was a pleasent suprise!

The new rates are 10.9% and 11.9%.  (Depending on balance.)

These rates are VERY favorable against other credit unions!

I keep seeing changes that make me feel like we are getting back to
being a credit union and going away from being a bank!!!  It has me
thinking about finding out what the rates would be to xfer my truck loan
from USAA to DCU, plus some other business.

Getting Chuck and his banking crew to leave, along with recent
membership chosen credit union philosphy board members, has caused my
faith to increase dramatically!

Another positive occurred at my local DCU office (ZKO).  I had a
Canadian Postal Money Order made out in US dollars.  I figured that DCU
would not accept it and that my wife would have to take it to a bank. 
She asked me to give it a try at DCU and I gave her the usual, why waste
my time.

End result is I took it to the branch.  They had not seen one before but
took the time to look it up, call the correct people and get it OK'd for
deposit!  Thanks to Bonnie and the Branch manager Gloria!  That is the
type of service that causes me to WANT to work with DCU.

Feel free to pass onto other BOD members and DCU.  They all deserve a
pat on the back.  I know I will be filling out a, 'How are we doing?'
card and letting them know of this great service I received!

	- mark

    Well, I quit using my DCU gold card when I found I was being charged
    finance charges even when I'd paid the previous month's balance on
    time. Turns out (reading the back of the statement) the rules with
    this card for assessing finance charges are baroque to the point of
    incomprehensibility (I know *I* couldn't figure them out). I may
    start using the card again after a couple of months of quiesence
    (assuming they don't charge me a finance charge for not using the
    card or something like that), or I may just cancel it.
    
    I got the card based on its lower interest rate. It's *cost* me a
    lot more than other cards I've used with much higher rates, because
    of the unusual rules (at least unusual relative to the other cards I
    compared it with) for finance charges.

    Can you articulate the rules about finance charges?
    

    Articulate? Probably not. Attempt:
    
    On the back of the statement is this:
    
        No FINANCE CHARGE will be imposed on new purchases which appear
        for this first time during a Billing Cycle if (1) the entire New
        Balance of the account  at the beginning of the Billing Cycle
        (including unpaid FINANCE CHARGE due) is paid in full by the
        Payment Due Date, or (2) there was no Previous Balance in the
        account at the beginning of the Billing Cycle.
    
    I have a couple of bills in which I paid the entire balance before
    the payment due date but was still assessed a new finance charge. I
    suspect the operative phrase is "which appear for the first time".
    If Checkfree was a day late the previous month and its payment
    appears in this month, finance charges are still (I think) assessed
    on the entire previous bill. Or something. 
    
    For me, the bottom line has been that I've had a much easier time
    avoiding any finance charges on other cards. Something in the way
    the calculations are done by DCU makes this card seem finance-charge
    happy, and the easiest way to avoid them has been to not use the
    card. On other cards I'll be hit with a late charge if my payment
    gets in late, but if it was for the full amount, there's no finance
    charge the *following* month (in which all the payments arrived).

Thanks for the posting..

>     I have a couple of bills in which I paid the entire balance before
>     the payment due date but was still assessed a new finance charge. I
>     suspect the operative phrase is "which appear for the first time".
>     If Checkfree was a day late the previous month and its payment
>     appears in this month, finance charges are still (I think) assessed
>     on the entire previous bill. Or something. 
>     

Could it be that Checkfree was late in sending the payments to DCU?

Gim

DCU's rules in this area are the most liberal I have seen of any card, but they
are also quite common.  If your balance is not paid off by the due date, then
you WILL get a finance charge the next month, including the unpaid balance
until it is paid.  Don't blame DCU if your payment was late.

Most of the offers I get in the mail use a "two-cycle average", where if you
don't pay off in full in a given month, you'll get socked interest for the next
two months, even if you pay it all off in the first month.  Discover uses this
method as well.

					Steve

    I'm looking at a bill whose boxes include (numbers changed for
    general paranoia but kept in original ratios):
    
    Previous balance:	$84
    Payments received this Billing Cycle: $84
    Finance Charge paid this Billing Cycle: $1
    Current Purchases and Advances: $17
    Credits: 0
    New Balance: $18
    Finance Charge Due: $1
    Balance on which finance charge was computed: $95
    
    This is an example of my puzzlement: previous balance was paid *in
    full* within the billing cycle *by their own statement* but I was
    still assessed a finance charge. The finance charge was computed on
    an amount larger than either the previous *or* current bill. I've
    never seen this on bills from other cards. If that's due to the "two
    cycle average", to my mind it's still a valid reason to quit using
    the card (and, for the most part, DCU).
    
    I've been progressively reducing my use of DCU, and this business
    with the card does nothing to induce me to reverse the trend.
    
    Yes, I occasionally get out of synch and a payment's late. (Less
    often since I started using Checkfree, but I'll still get
    disctracted and not get around to things once in a while.) That's
    what late fees are for. Loan shark charges on top of the late fees I
    don't need. 

DCU does *NOT* use two-cycle average.  If it did, I would not carry a
DCU Visa card.  Note that Discover does use this method.

Looking at your figures, I would say that you had a finance charge due in the
previous month which was not paid, but you should call DCU's Visa office for
a complete explanation. 

You will not find a more favorable finance charge system than what DCU
uses.

				Steve

Payments received this billing cycle =/= Payment received before due date

The billing cycle is the days between the date of the last statement and
the date of this statement ... typically 30

The due date is only 25 days into the billing cycle.

Re: 147,

There is no interest charge if the previous month's balance
is paid in full. I called the DCU line to verify.

There's another explanation and .148 may have hit the nail
on the head. The full balance may NOT have been paid in full or
you might have taken out a cash advance. The numbers suggest
the first explanation.

You should call DTN 223-6735 and get a FULL explanation.

Gim

    ... 149.
    
    That showed where the confusion arises. The payment in my example
    was credited during the 5-day window between "payment due date' and
    "billing cycle closing date". The monthly statement shows the
    billing cycle closing date, but *not* the previous month's payment
    due date (which is the more useful of the two). So if a payment is
    credited in that 5-day no-mans-land between due date and end of
    billing cycle, it shows up as credit on the next month's statement
    but nonetheless causes the finance charge to be assessed, with no
    clear indication of why. 
    
    For people who normally run with a balance, this might not be
    interesting. I always pay off in full ... albeit occasionally a tad
    late ... so any finance charge at all is unwelcome news. That's one
    reason why the lower rates aren't particularly interesting to me,
    since I don't really intend to avail myself of them.
    
    Maybe I've just been very lucky with other cards (or unlucky with
    DCU) as far as timing goes, but I believe the other credit card
    bills simply don't show the late credit until the following bill, so
    it's much clearer why there's a finance charge. On those bills, if I
    see my payment credited, I *never* see a finance charge. Hence my
    concern with the DCU statement.
    
    My suggestion would be to change the box that's labeled "Payments
    received this billing cycle" (technically accurate but misleading
    since it suggests they weren't late) to one that shows "Payments
    received by due date", or perhaps add a box of the second flavor, so
    that the reason for any charges can be determined without squinting
    at the fine print on the back of the statement.

>    My suggestion would be to change the box that's labeled "Payments
>    received this billing cycle" (technically accurate but misleading
>    since it suggests they weren't late) to one that shows "Payments
>    received by due date", or perhaps add a box of the second flavor, so
>    that the reason for any charges can be determined without squinting
>    at the fine print on the back of the statement.


OR to actually include the Payment Received as a line item on the bill (like
many do ...) with a transaction / posting date.

Actually, many of these "free" card issuers are now hitting people with
VERY HEFTY late charges ... $15 minimum ... as well as the finance charge.

One common practice too in calculating bills is this ...

This month ...

Running balance 	$1000		Jan 1
Finance charge		$20		Jan 1

SO ... thinking that if you pay this ... all is clear ...

Payment			$1020		Jan 15

Next month ... FOOLED YA!

Finance charge		$10.20		Calculated as 15 days of 1020 balance



Which makes sense really, since you did owe 1020 for 15 days ... but can be
confusing.  For most card issuers, NEW charges in February have the grace 
period since this new Finance Charge is not considered an Interest Bearing
Balance ... since grace periods are dependent on having no interest Bearing
balance.


So, DCU actually gives you both ends of the deal ... pretty fair if you ask
me!

Stuart

	I have a Bank One Gold Visa.

	A couple of times, I've been a bit late in the payment, but I've always
hit the window between the "due" date and the statement date.  I've never paid
them a penny in interest charges. I do realize that this may change at any time,
and I don't make a habit of it.

	I'm always certain to leave enough mailing time for the Discover card.
I figure it's worth it to get the $50-$60 back.

							--Doug

When NETWORK announced the lower interest rates and since there is no annual
fee, I decided I'd get a DCU VISA and get rid of my other card.  When I used
option 3 as instructed, the line went blank after the message indicating there
would be a short silence.  After 5 tries, I decided to call and speak with a
live person.  The DCU representative said she would send me a VISA application
that I should sign and return.  Well 5 days later I received an application to
open a DCU share account.  As I tossed the application in the trash, I simply
sighed and gave up.

Gwen

    I have belonged to DCU for about 10 years.  In that period, I requested
    a VISA application form, maybe, 8-10 time.
    
    Once I received an application form in response to my requests.  I
    completed and returned it to the DCU.  Lost and never heard from DCU. 
    In fact, when I called to inquire about the status of my application, I
    was told that the application was never received and was promised
    another application to complete and return.  Never received it.
    
    A few days I received the pre-approved DCU VISA card offer.  I fainted.
    Upon recovery, I completed the few questions asked and mailed it
    immediately.
    
    I can't wait to see what happens this time!!!
    
    (had to tell someone -- don't really need another credit card -- just
    want to see if they really do exist)
    
    Randy