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Behind on your credit-card payments? Your credit score isn’t the only thing at risk. You’re also very quickly blowing up any chance of collecting those rewards that come with your card.

CardHub.com, a leading online marketplace for credit cards, conducted a mini-study that examined the fine print of reward programs for the top six major credit-card issuers.  Among its findings:

  • In the last 12 months, 15% of U.S. adults have been late making a credit-card payment. The credit-card default rate in 2009 is the highest since 1991.
  • If an account becomes delinquent, all points earned under American Express rewards program may be lost.
  • If an account becomes two months or more delinquent, all points under the Discover rewards program will be lost.
  • Other issuers, such as Bank of America, Capital One and Citibank, generally will not allow you to earn rewards while your account is delinquent. (According to the survey, Chase did not disclose any information about its programs.)

What’s a cardholder to do?

Face the cold hard facts. Reward programs only make sense if you pay your balance in full each month. If you carry a balance or can’t make the payment on time, a reward program isn’t for you.  If you’re pinched, you need to curb your spending and pay off the debt.

And let’s be clear here: Issuers can change the terms and conditions of their reward programs at any time or for any reason. There’s no notification period. No warning needed. That’s different from the current rules that require at least 15 days notice before issuers change your interest rate or fees. (Under the new law, that notification must come at least 45 days before any changes are made to your account.)

Yes, rewards are super under the right conditions.  Just make sure you’ve picked a card and program that work for you – and pay on time so you don’t blow your bennies.

Want to learn more? Check out my columns for more tips:

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On websites such as creditcardhub.com, how can you tell which cards are “legit” cards? In searching for a credit card in order to rebuild my credit, my difficulty lies in trying to determine which ones are reputable and whichs ones are not.


Do you have any advice for someone who is trying to repair their credit, but are denied, even for some secured cards.


First, don’t try to do too much too fast. Applying for too many cards in too short a time period can trigger score drops and denials. If you have a card, use it lightly (charge less than 30% of your limit, less than 10% is even better) and pay it off in full every month. It may be better in the long run to establish a relationship with a credit union with regular or secured credit cards that report to all three bureaus.


CardRatings.com has a card rating system that you might want to check out. CreditCards.com also has a summary of features that might help you build your comfort level. Also, some “credit building” cards are issued by well-known banks like Citi.