Capital One is a very popular banking institution because of its benefits. Some people wonder about Capital One Spark Business reports to personal credit and the process of closing a Capital One card. However, most just want to integrate with the bank.
Now, you may have received blank checks from your credit card company, but this is not a gift or a cashing alternative. Convenience checks are an alternative for you to access cash quickly through your card’s credit line without having to swipe it at any point of sale.
It is common to receive this type of checks from companies such as Credit One, however, you should pay attention to the drawbacks that usually come with them. It is normal for these options to have high interest rates and less protection.
How a convenience check works
We can say that the operation of a convenience check is very similar to that of a cash advance, they are typically used to pay outstanding bills or to acquire some cash when you need it. These checks appear at the end of the month on your credit card statement.
It should also be noted that the cash advance limit is typically less than the credit limit on your card. Before using it, you must pay attention to these limits to avoid accessing a debt that later becomes impossible to cover. It is common to receive an e-mail from the bank with a convenience check.
What are the benefits of accepting a convenience check?
With a convenience check, you have the possibility of accessing your line of credit at times when you need to pay for products or services where credit cards are not accepted. This alternative is used by some people to make rent payments since landlords usually do not accept credit cards.
It is also an available option to access cash when you need it, you just need to write a convenience check and cash it just like a personal check. It can even be used to pay off your credit card with another credit card. Although you have to have cards from different banks to do this.
In short, you can benefit from convenience checks in emergency cases where it is not possible to use your credit card in a conventional way. It is advisable to do it with caution because it is still a charge that is made to the monthly credit card bill.
How do I get a Credit One convenience check?
Generally, these products arrive in your mail along with your monthly statement, it is not usual that you have to request them from your provider. Please note that this option is usually offered to customers who have a good credit rating, which ensures that they will be responsible for their rate payments.
If you do not receive one in your monthly mail, you can contact Credit One through the phone number on the back of the credit card. When you contact the operator, ask for the convenience check, although if you do not qualify for this product, it will be indicated immediately and they can provide you with some solutions.
Will using a convenience check affect my credit score?
The convenience check will not be responsible for directly impacting your credit history, however, if you use them constantly it does cause an increase in your credit utilization rate because you accumulate more credit card debt. Remember that 30% of your credit score is credit utilization, so you need to take care of it.
As we mentioned earlier, convenience checks are like cash advances, which indicates that all the charges and fees associated with them cause your debt to go up. To avoid reflecting on your credit score, you need to make the check payment fast and that prevents you from ending up using more of the credit you have available.
On the other hand, if you opt for this alternative, you constantly indicate to the bank that you do not have enough cash in your savings and checking accounts, which will make them keep track of your debts. In case of late or missed payments, you may see a negative impact on your credit.
What alternatives do you have to convenience checks?
It is normal that at certain times you need access to cash and do not have it available in your savings or checking accounts, for these occasions, it is not necessary to request a convenience check. Banks have different benefits that can help you, such as:
- Personal loans are common and you can find many with much lower interest rates than convenience checks
- Cash advances, while similar to convenience checks, are not the same
- Search for places where you can make payments with credit cards
Some people recommend that you borrow money from family or friends, so you avoid the high fees that banks charge when they lend you money. It is also an option to avoid charging the credit card and making the end-of-the-month amount higher than expected.
Convenience checks can be a great solution in times of hardship, but eventually, you may end up paying much more than you asked for. This is not cost-effective if you want to keep your finances in order and avoid having more debt than you can pay.
Are Credit One’s convenience checks a good option?
This entity has, like the rest, quite high interest rates when you make applications for loans, cash advances, or convenience checks. As we have said before, although it can be an alternative to get out of trouble, you should consider whether it is worth it.
“Reddit – Dive into Anything.” Reddit – Dive into Anything, https://www.reddit.com/r/personalfinance/comments/b2rlvu/credit_card_company_sent_me_a_check_in_the_mail/?onboarding_redirect=%2Fr%2Fpersonalfinance%2Fcomments%2Fb2rlvu%2Fcredit_card_company_sent_me_a_check_in_the_mail%2F
“The Pros and Cons of Getting a Cash Advance.” CreditOneBank, https://www.creditonebank.com/articles/the-pros-and-cons-of-getting-a-cash-advance