Why Don’t I Always Have to Sign for Credit Card Purchases?

Between deliveries, bank transactions, and contracts large and small, scribbling your John Hancock is practically an everyday event. But have you ever wondered why you sometimes don’t have to sign for a credit card purchase? The answer is a little more complex than you might expect. Curious? Take a look at the details below!

In general, this is why you sign for credit card purchases

Before discussing when you need to sign for a credit card purchase and when you don’t, let’s review the reasons you sign for plastic transactions in the first place.

The first is identity verification. One of the reasons you’re required to sign the back of your credit card is so that merchants can check the signature on your card to the signature on your receipt. If they don’t match, this is one way to catch a credit card thief. Of course, it’s pretty rare that a store clerk will actually take this step, but it could theoretically happen.

The second is to protect all parties involved (you, the merchant, and the credit card company) in the event that a purchase is disputed. For example, if you spot a transaction your credit card statement that you didn’t make, the credit card company can demand a signed receipt from the merchant to prove you it was you who swiped the card. If he can’t, your case is bolstered. But alternatively, if he can, he’s protected from having to refund the cash.

When you need to sign, and when you don’t

Signatures are all well and good, but in today’s world we have a need for speed. The two major credit card networks (Visa and MasterCard) recognize this, and have started to reduce the signature burden on retailers. Consequently, whether or not you have to sign for a purchase mostly boils down to how much you’ve spent.

As of October 2012, MasterCard doesn’t require signatures for most transactions under $50. Likewise, Visa no longer requires signatures for transactions under $50 at grocery stores and discount stores, or purchases under $25 at most other retailers. This explains why your morning stop at the local coffee shop doesn’t involve signing for your latte.

But keep in mind that there are exceptions to these guidelines. Visa and/or MasterCard require signatures on purchases of any size from certain merchant categories, including: quasi-cash, gambling, direct marketing, money transfer, automated fuel dispensers, and financial institutions.

Also, just because Visa and MasterCard don’t require signatures on small transactions doesn’t mean that the merchant you’re shopping with is onboard with ditching autographs. Remember, signing for a purchase protects the retailer in the event that you dispute a purchase. Some merchants aren’t willing to take the risk of losing out on profits if they end up in a scuffle with your credit card company.

Will signing go away with the transition to EMV?

By now you’re probably wondering about the fate of signatures when the U.S. migrates to EMV credit cards in late 2015. Honestly, the answer to this question is unclear. There’s the possibility we could all soon start punching in PINs when we use our cards, which would eliminate the need for a signature altogether. And chip-and-PIN technology has the advantage of being one of the most hack-proof payment systems out there today.

But the reality is that we’ll probably shift to chip-and-signature, not chip-and-PIN – at least initially. It’s been a struggle to get U.S. consumers, retailers and credit card issuers to make the move to EMV, so going from simplistic magnetic strip payments directly to the more complicated chip-and-PIN might be too big a leap to make overnight. And with chip-and-signature transactions, the same autograph rules Visa and MasterCard set out for swipe-and-sign purchases remain in place (see above). Overall, holding onto signatures is less disruptive to our usual way of doing business.

So keep practicing that signature – you’ll probably still need it for large credit card purchases for quite a while!

Signature on receipt image via Shutterstock

Source Article http://ift.tt/1y39EC7

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Why Don’t I Always Have to Sign for Credit Card Purchases?

Between deliveries, bank transactions, and contracts large and small, scribbling your John Hancock is practically an everyday event. But have you ever wondered why you sometimes don’t have to sign for a credit card purchase? The answer is a little more complex than you might expect. Curious? Take a look at the details below!

In general, this is why you sign for credit card purchases

Before discussing when you need to sign for a credit card purchase and when you don’t, let’s review the reasons you sign for plastic transactions in the first place.

The first is identity verification. One of the reasons you’re required to sign the back of your credit card is so that merchants can check the signature on your card to the signature on your receipt. If they don’t match, this is one way to catch a credit card thief. Of course, it’s pretty rare that a store clerk will actually take this step, but it could theoretically happen.

The second is to protect all parties involved (you, the merchant, and the credit card company) in the event that a purchase is disputed. For example, if you spot a transaction your credit card statement that you didn’t make, the credit card company can demand a signed receipt from the merchant to prove you it was you who swiped the card. If he can’t, your case is bolstered. But alternatively, if he can, he’s protected from having to refund the cash.

When you need to sign, and when you don’t

Signatures are all well and good, but in today’s world we have a need for speed. The two major credit card networks (Visa and MasterCard) recognize this, and have started to reduce the signature burden on retailers. Consequently, whether or not you have to sign for a purchase mostly boils down to how much you’ve spent.

As of October 2012, MasterCard doesn’t require signatures for most transactions under $50. Likewise, Visa no longer requires signatures for transactions under $50 at grocery stores and discount stores, or purchases under $25 at most other retailers. This explains why your morning stop at the local coffee shop doesn’t involve signing for your latte.

But keep in mind that there are exceptions to these guidelines. Visa and/or MasterCard require signatures on purchases of any size from certain merchant categories, including: quasi-cash, gambling, direct marketing, money transfer, automated fuel dispensers, and financial institutions.

Also, just because Visa and MasterCard don’t require signatures on small transactions doesn’t mean that the merchant you’re shopping with is onboard with ditching autographs. Remember, signing for a purchase protects the retailer in the event that you dispute a purchase. Some merchants aren’t willing to take the risk of losing out on profits if they end up in a scuffle with your credit card company.

Will signing go away with the transition to EMV?

By now you’re probably wondering about the fate of signatures when the U.S. migrates to EMV credit cards in late 2015. Honestly, the answer to this question is unclear. There’s the possibility we could all soon start punching in PINs when we use our cards, which would eliminate the need for a signature altogether. And chip-and-PIN technology has the advantage of being one of the most hack-proof payment systems out there today.

But the reality is that we’ll probably shift to chip-and-signature, not chip-and-PIN – at least initially. It’s been a struggle to get U.S. consumers, retailers and credit card issuers to make the move to EMV, so going from simplistic magnetic strip payments directly to the more complicated chip-and-PIN might be too big a leap to make overnight. And with chip-and-signature transactions, the same autograph rules Visa and MasterCard set out for swipe-and-sign purchases remain in place (see above). Overall, holding onto signatures is less disruptive to our usual way of doing business.

So keep practicing that signature – you’ll probably still need it for large credit card purchases for quite a while!

Signature on receipt image via Shutterstock

Source Article :http://bit.ly/1u7d3Nt

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Bank Hacked Prescription: Take These Steps for Self-Protection

Consumers concerned about the safety of their bank and credit accounts should take defensive and proactive steps right away to protect their financial well-being if hackers have attacked.

And these days, that seems to include just about everybody. Last year alone, more than 13 million Americans were victimized by identity fraud, according to Javelin Strategy & Research in Pleasanton, Calif. More recent data breaches at major U.S. financial institutions and retailers have exposed potentially millions more. Russian hacker attacks on JPMorgan Chase and at least four other banks in August resulted in the loss of gigabytes of customer information, according to Bloomberg News.

While Bloomberg said Chase plans to contact customers who might be affected by the latest breach, there’s no reason not to take the following steps now, even if your bank or credit provider hasn’t been hacked – it just may not know it yet.

Change logins and passwords

It’s a chore but an easy one and may prevent much bigger headaches later: Change all logins and/or passwords for each bank and credit account, and consider changing personal identification numbers (PINs) as well. Some safety experts advise taking this step at least once every six months to protect against fraud even if you don’t think the accounts have been exposed. It’s good medicine.

Examine recent statements

Go through account statements line by line and verify each transaction. Even a tiny discrepancy should be reported immediately. Thieves often start by making a small test purchase before engaging in larger fraud, so catching them early counts.

Check balances frequently

Mobile or online banking users in particular should check statements frequently to ensure that no suspicious charges crop up unnoticed. Consider setting up email or text alerts each time a transaction occurs in an account, if that option is available.

Flag suspicious activity

Report any unauthorized charge or suspicious activity to the bank or credit provider immediately. At some providers, tardy reporting leaves the account holder exposed to greater losses that the company won’t cover.

Be wary of queries

Banks generally never ask for account information such as a password or PIN by telephone or email, so don’t trust official-looking inquiries seeking personal information to verify accounts or for other purposes. It could be a “phishing” expedition by fraudsters looking to prey on the unsuspecting. Don’t bite! But if there’s a compelling reason to make sure everything is okay, go on the company’s website to check. Don’t click on links or pop-ups suspicious emails may contain.

Understand liability

Find and review any account agreements and policies to make sure what you may be liable for and what the company will do in the event of fraud or other unauthorized activity, as well as your reporting obligations. In general, banks and credit providers won’t hold customers accountable for losses tied to theft or identity fraud, provided they are reported in a timely manner.

Fraud alerts

Ask the three major credit-rating companies – Equifax, TransUnion and Experian – to provide fraud alerts so that lenders know your information may be compromised. These notices require extra steps to verify a would-be borrower’s information and identity before doing business with them. Consumers can also tell the raters to lock up their credit reports, effectively blocking the creation of new accounts.

Extra authentication

Some companies have adopted two-factor authentication systems to provide an extra level of protection for account access. Some require users to respond to a text message while others ask for the identification of a preset symbol or picture before a user can log in.

Banks are required to alert customers when data has been breached, but it can take weeks to determine what was exposed. So don’t wait – take these steps now to protect your financial health.

JPMorgan Chase image via Shutterstock

Source Article :http://bit.ly/1qGdJdb

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Bank Hacked Prescription: Take These Steps for Self-Protection

Consumers concerned about the safety of their bank and credit accounts should take defensive and proactive steps right away to protect their financial well-being if hackers have attacked.

And these days, that seems to include just about everybody. Last year alone, more than 13 million Americans were victimized by identity fraud, according to Javelin Strategy & Research in Pleasanton, Calif. More recent data breaches at major U.S. financial institutions and retailers have exposed potentially millions more. Russian hacker attacks on JPMorgan Chase and at least four other banks in August resulted in the loss of gigabytes of customer information, according to Bloomberg News.

While Bloomberg said Chase plans to contact customers who might be affected by the latest breach, there’s no reason not to take the following steps now, even if your bank or credit provider hasn’t been hacked – it just may not know it yet.

Change logins and passwords

It’s a chore but an easy one and may prevent much bigger headaches later: Change all logins and/or passwords for each bank and credit account, and consider changing personal identification numbers (PINs) as well. Some safety experts advise taking this step at least once every six months to protect against fraud even if you don’t think the accounts have been exposed. It’s good medicine.

Examine recent statements

Go through account statements line by line and verify each transaction. Even a tiny discrepancy should be reported immediately. Thieves often start by making a small test purchase before engaging in larger fraud, so catching them early counts.

Check balances frequently

Mobile or online banking users in particular should check statements frequently to ensure that no suspicious charges crop up unnoticed. Consider setting up email or text alerts each time a transaction occurs in an account, if that option is available.

Flag suspicious activity

Report any unauthorized charge or suspicious activity to the bank or credit provider immediately. At some providers, tardy reporting leaves the account holder exposed to greater losses that the company won’t cover.

Be wary of queries

Banks generally never ask for account information such as a password or PIN by telephone or email, so don’t trust official-looking inquiries seeking personal information to verify accounts or for other purposes. It could be a “phishing” expedition by fraudsters looking to prey on the unsuspecting. Don’t bite! But if there’s a compelling reason to make sure everything is okay, go on the company’s website to check. Don’t click on links or pop-ups suspicious emails may contain.

Understand liability

Find and review any account agreements and policies to make sure what you may be liable for and what the company will do in the event of fraud or other unauthorized activity, as well as your reporting obligations. In general, banks and credit providers won’t hold customers accountable for losses tied to theft or identity fraud, provided they are reported in a timely manner.

Fraud alerts

Ask the three major credit-rating companies – Equifax, TransUnion and Experian – to provide fraud alerts so that lenders know your information may be compromised. These notices require extra steps to verify a would-be borrower’s information and identity before doing business with them. Consumers can also tell the raters to lock up their credit reports, effectively blocking the creation of new accounts.

Extra authentication

Some companies have adopted two-factor authentication systems to provide an extra level of protection for account access. Some require users to respond to a text message while others ask for the identification of a preset symbol or picture before a user can log in.

Banks are required to alert customers when data has been breached, but it can take weeks to determine what was exposed. So don’t wait – take these steps now to protect your financial health.

JPMorgan Chase image via Shutterstock

Source Article http://ift.tt/1y39EC7

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Millennials Often Feel `Extreme Financial Stress,’ Survey Shows

About a decade out of school and still finding the going tough, economically speaking? You’ve got company. More than one in five Americans 24 to 34 struggle to make ends meet, saying they’re under “extreme financial stress” in a survey released by TD Bank, while two thirds say they wished they were better prepared for major financial events like going to college, having a child or buying a car.

Among older millennials, the top source of financial stress is covering bills, including mortgage and student loan payments, cited by 45% of respondents, according to the Cherry Hill, N.J.-based bank. While more than half – 55% – say they have a hard time “finding financial happiness,” a third say they’re “frustrated” by inadequate funds, whether because of limited incomes or an inability to save anything.

“Many factors can contribute to millennials’ financial stress,” says Nandita Bakhshi, who heads consumer banking for the company.

For one thing, getting a job is harder. Unemployment rates are higher for 25- to 34-year-olds, rising to 6.6% in July from 6.5% in June, according to U.S. Department of Labor statistics. That compares with a 6.2% average U.S. jobless rate. For younger millennials, those 20 to 24, the rate climbed to 11.3% from 10.5%. Meanwhile, the financial burden of earning a college degree continues to grow heavier, rising to about $33,000 on average for this year’s graduates, according to Edvisor, a website focused on college financing. So it should be no surprise that many young adults feel they’re under unrelenting financial pressure.

Yet most don’t turn to professionals for advice when confronting major life events – they reach out to family and friends instead. When evaluating college costs, 45% consulted with family, while 28% attended classes or seminars and a quarter talked with friends, according to the poll of 1,006 young Americans. Fewer than 15% either visited a bank website or spoke with a banker or financial adviser. Most – 67% – say they wished they’d been more financially proactive in preparing for the move.

Homebuyers differ

Contacting a bank only tops family or social connections when it involves decisions about buying a home. When seeking information about financial products, 65% of millennials speak with family and friends while fewer than a third consult with a banker, according to the survey. About a fifth say they didn’t need to take a formal seminar on the topic, while more than a quarter say they don’t have the time and more than a third, 37%, say the thought of taking a course or class on it never occurred to them.

“Millennials need to be proactive in finding education that fits their needs so they can be more prepared for the events they will experience throughout their lives,” says Bakhshi.

Apparently, that idea often only sinks in after the fact.

Broke consumer image via Shutterstock

Source Article http://ift.tt/1y39EC7

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Millennials Often Feel `Extreme Financial Stress,’ Survey Shows

About a decade out of school and still finding the going tough, economically speaking? You’ve got company. More than one in five Americans 24 to 34 struggle to make ends meet, saying they’re under “extreme financial stress” in a survey released by TD Bank, while two thirds say they wished they were better prepared for major financial events like going to college, having a child or buying a car.

Among older millennials, the top source of financial stress is covering bills, including mortgage and student loan payments, cited by 45% of respondents, according to the Cherry Hill, N.J.-based bank. While more than half – 55% – say they have a hard time “finding financial happiness,” a third say they’re “frustrated” by inadequate funds, whether because of limited incomes or an inability to save anything.

“Many factors can contribute to millennials’ financial stress,” says Nandita Bakhshi, who heads consumer banking for the company.

For one thing, getting a job is harder. Unemployment rates are higher for 25- to 34-year-olds, rising to 6.6% in July from 6.5% in June, according to U.S. Department of Labor statistics. That compares with a 6.2% average U.S. jobless rate. For younger millennials, those 20 to 24, the rate climbed to 11.3% from 10.5%. Meanwhile, the financial burden of earning a college degree continues to grow heavier, rising to about $33,000 on average for this year’s graduates, according to Edvisor, a website focused on college financing. So it should be no surprise that many young adults feel they’re under unrelenting financial pressure.

Yet most don’t turn to professionals for advice when confronting major life events – they reach out to family and friends instead. When evaluating college costs, 45% consulted with family, while 28% attended classes or seminars and a quarter talked with friends, according to the poll of 1,006 young Americans. Fewer than 15% either visited a bank website or spoke with a banker or financial adviser. Most – 67% – say they wished they’d been more financially proactive in preparing for the move.

Homebuyers differ

Contacting a bank only tops family or social connections when it involves decisions about buying a home. When seeking information about financial products, 65% of millennials speak with family and friends while fewer than a third consult with a banker, according to the survey. About a fifth say they didn’t need to take a formal seminar on the topic, while more than a quarter say they don’t have the time and more than a third, 37%, say the thought of taking a course or class on it never occurred to them.

“Millennials need to be proactive in finding education that fits their needs so they can be more prepared for the events they will experience throughout their lives,” says Bakhshi.

Apparently, that idea often only sinks in after the fact.

Broke consumer image via Shutterstock

Source Article :http://bit.ly/1tCLPit

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Why Isn’t My Credit Score Listed On My Credit Report?

So there you are expecting your credit score to show up as you pull your credit report from one of the big credit bureaus and … it isn’t there. You are probably annoyed that you took the time and perhaps spent money in the hope of finding your credit score on that credit report. It makes sense that the credit score should appear on your credit report, so why doesn’t it and what can you do about this?

Credit score background

The first thing to understand is that credit reports and credit scores are two totally different products.

The FICO score is a proprietary credit scoring system that was created back in the 1950s. The company that developed it – Fair, Isaac and Company – then sold the scoring system. At first, there were other scoring systems that competed with it.

However, once Equifax started using it as a general purpose credit score, it pretty much caught on as the standard.

In other words, the company that invented the FICO Score was so successful with it that the entire credit industry adopted it as a standard method of determining creditworthiness. It is a product the credit bureaus subscribe to in order to evaluate you, and it is a product you buy to see where you stand.

Credit report: What’s in it?

The credit report is just that – it lists your entire credit profile so that creditors can examine it and evaluate your creditworthiness, both independent of the FICO Score and in conjunction with it. You can order your credit score though the bureaus as well, and they also have their own scoring system which will mean little to you.

Credit score: It’s not free, mostly

Your FICO score is rarely offered for free. Those sources may offer you a free FICO score, but then you’ll be signed up for a monthly recurring charge in some kind of membership program involving credit, or credit monitoring, or as a value-add by using a certain credit card (like Discover, which offers a free score on your statement every month). These might be worth it, depending on various circumstances.

However, the Fair Credit Reporting Act gives consumers access to their credit report for free – one report from each of the three big credit bureaus (Experian, Equifax, Transunion) once per year. This data is provided from a centralized source, http://ift.tt/o2j1vQ.

In addition, the FCRA entitles you to a free credit report if a company or creditor takes what’s called “adverse action” against you. This includes denying an application for credit. You may also get one if your report is inaccurate because of fraud.

You can dispute errors or you may have found a case of fraud. You want to do this not only so everything is correct, but because it will effect your FICO score.

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