Legally, your credit card company can only hold you responsible for $50 of unauthorized purchases on your credit card. However, if you fail to report the fraud within a reasonable amount of time, you may be required to pay for all the fraudulent purchases. With credit card fraud on the rise, there are many reasons to check out cards with $0 fraud liability policies:
- You won’t have to pay a dime. This is the most obvious reason, but it’s not to be overlooked. Technically, you never should pay more than $50, but if you can get a card with no fraud liability as well as no annual fees, why wouldn’t you do it? Of course, you don’t, on the other hand, want to pay $40 a year in annual fees for a card like this. However, many no annual fee credit cards still come with no fraud liability these days, which makes it a deal worth having.
- Credit card thieves are becoming savvier and more prominent. Credit card fraud has gone up again this year, and many Americans are finding out too late about the problems with their card. Now, 37% of all credit card fraud is due to counterfeit cards, which use high tech devices to skim information off your card’s magnetic strip! 10% of all fraud takes place without the card even present, which is often a problem when you’re shopping online, and about 23% of credit card fraud is due to lost or stolen cards that can easily be used by strangers.
Since the thieves who are out to steal your money are so much more common, you need to protect yourself as best you can with $0 fraud liability on all your credit cards.
- You often get even more protection. Many times, companies that offer this type of protection on your credit card will actually help you catch fraud. Think about it. Companies who don’t make you pay for fraudulent purchases don’t want to take it out of their own pockets either, and credit card thieves are notoriously hard to catch.
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Some banks and credit card companies will now automatically protect you from fraud by watching your account for you. For instance, if you make a large credit card purchase online, the credit card company may call you just to double-check that you were the one actually making the purchase. This can be really helpful, as it can help you catch the fraud earlier, too.
- Companies who offer this often have better and faster fraud resolution procedures. Sometimes, you can get the problem fixed in as little as a day. This is a sight better than it used to be, when you might have had to wait a week or more to get your credit card company to fix fraudulent charges.
- It gives you peace of mind. Of course, one of the main reasons to go with a card with $0 fraud liability is that you get more peace of mind. When you know that you’re not going to be charged if something happens to your credit card, you can breathe a little easier.
One recent survey notes that credit card fraud is the thing American fear most right now – above even terrorism. If you’re struggling with worry about all the “what ifs” attached to your credit card, find a card with no liability and a company you trust to take care of your interests when the worst happens.
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Abigail H is a contributing writer at CreditDonkey, a credit card comparison and financial education website. Our data-driven analysis has been recognized by major news outlets across the country and has helped consumers make savvy financial and lifestyle decisions. (read more)