Clarification On The Annual Fee Of A Credit Card…

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Based on the apparent confusion of some commenters in the “On The Road” post, I figure this may help some people out.

Apparently people that signed up for the Amex Business Platinum card during the $250 cash back promo haven’t yet been charged the $300 annual fee.
I know I wasn’t, and at least 2 other people haven’t been as well.

Normally a credit card with an annual fee will bill you that fee in the first 2 statements of the card.

Yossi asked in the comments,
“How do you know that when you cancel(the amex plat.) they wont charge you for all the time you had the card??”

I may have never fully explained this, which is an oversight on my part.

When you sign up for a card with an annual fee, or if you sign up for a card which is free for the first year, you are never forced to pay the annual fee.

As long as you didn’t pay the statement with the annual fee charge on it you can call up the credit card and tell them that you do not agree to pay the annual fee.

One of two things will happen, either they will tell you that you may continue using the card for another year for free, or that you must cancel the card.

However, they will not and cannot force you to pay the annual fee!

In the case of the -$250 Amex Platinum, you can request the $250 back as a check, enjoy all of the amazing benefits for the year, and whenever they charge you the fee, just cancel the card!

So you never have to worry about cancelling a card before 12 months are up-just monitor your statements for the charge!(Or better yet, follow my strategy for cancelling cards in the knowledgebase)

Also of note, many companies, including AMEX will pro-rate the annual fee even if you’ve already paid it. So if a card has a $120 fee, but you cancel it 2 months after paying the fee, they will refund the $100.
I know Chase will not pro-rate, I’m not sure about other companies-feel free to comment if you have first-hand experience with another company.

20 COMMENTS

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  1. Anonymous

    This is amazing, i never knew that!

  2. Anonymous

    I cant find the post about canceling cards..?
    the only one i found was about combining acounts..?
    but that wouldn’t work for all cards..? (egsample the pltnium or the starwoods.. etc?)

  3. Anonymous

    do sprints “dropped calls” still work? why are they connecting me to an agent?

  4. Anonymous

    What would you suggest for a laser printer-fax-scan-copier in the range of about $200?
    Thanks

  5. Shmuel

    Amex allows you to re-allocate the credit line between your cards. as long as you leave $1000 on each card.

    I did it and have now $48,000 on one card (moved from all the other ones)

    online, just click:
    “See all Account Services” on the top right, then:
    “continue” then:
    “Credit Management” then:
    “Reallocate Your Line of Credit”

    note: this only works for cards with a credit line. no charge cards.

  6. Anonymous

    dan you once posted that the starwood amex BUSINESS can be churned, what about the starwood CONSUMER amex???????

  7. Anonymous

    any good prices from LA to NY for lag baomer weekend (the last deal didnt work for those dates)
    thanx

  8. Anonymous

    does anyone know if the free companion tickets that travel and leisure give out are worth anything or do they just charge so much for the first ticket that it cancels out the benefit. thanx

  9. shlomo

    if i cancel the continental mc to avoid the annual fee will i still get the mileage (it has already posted but the agent said that if i would switch to the fee free card than i would lose the miles) also what about the 150$. is it possible to combine a amex business gold and a starwood business. Thanks for running a awesome site

  10. Anonymous

    I dont know if you guys know about this or not.

    Get $150 gift card for applying for a Citi Professional Card.

    Instructions:

    I am not going to give you a link because then it will mess it up for everyone.

    Here is what you need to do.

    1. Go to citicard.com look for the Citi Professional Card with Thank YOu Points. It will offer 100.00 gift card. or 10K points

    2. Click apply now.

    3. Fill in your name and address

    4. Click “Already a user” (It doesnt matter if you arent)

    5. You should get a pop up window offering you a bonus 5K thank you points if you apply. Click apply and enjoy your gift certificate.

    The above steps make it seem complicated. It aint.

    Regards.

  11. Anonymous

    CONSUMER Amex can be churned. I’ve done it.

  12. Anonymous

    thanx so much anonymous for answering me regarding the amex consumer. it’s really nice to see people are out to help others.
    Y. Brooklyn

  13. yossi

    are you sure…
    ” (1) To be eligible to receive 10,000 bonus Starpoints®, you must make your first purchase with the Starwood Preferred Guest® Credit Card within one year of Card approval. Bonus points will appear on your Starwood Preferred Guest statement 6—8 weeks after your first purchase. Bonus Starpoints are for first-time Starwood Preferred Guest Credit Cardmembers only. You may have more than one Starwood Preferred Guest Credit Card account; however, if you have or had any such account you are not eligible to receive bonus Starpoints you may be offered for any other such account. “

  14. Dan

    All credit cards say that you will only receive the signup bonus once.

    What separates the men from the boys is if they actually enforce those terms…

    Citibank never enforces it, Chase and Amex only do on certain cards.

    The Starwood Amex is one of the ones that can be churned, the Delta Amex cannot be churned.

  15. Yossi

    I just got my Business Platinum card.
    I was really exited to be able to use the loange on my stop over on the way to israel…
    but i see here that you can only use the lounge when you fly on Continental, Delta or Northwest…

    if im flying another airline they wont let me in???

  16. yossi

    oh and now i see that you have to be 21 to enter without a “parent or gurdian” ????

  17. yossi

    So i called them and “complained about not being able to loange during my stop over and “threatened” not to avtivate my card. The agent put me on hold… then told me that she would credit my card $75 to buy a day pass at the lounge.. i told her i was traveling with a partner so she credited it $150! (-: now i have to try to get in without actualy using the credit…

  18. yossi

    dont meen to bore any one.. but i called them again and asked what about my return flight.. cause they gave me $150 to buy access on my way in..
    so she did a times 2
    $300!!

  19. MTSB

    anon asking about churning
    i personally churned both starwood cards twice

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