Credit Card Convenience Checks Bounce on Surprised Account Holders

Some Americans attempting to use credit card convenience checks issued earlier in the year have discovered some hard truths about borrowing in the post-recession economy. A Bloomberg News report profiles a pair of consumers reeling from unexpected fees and legal bills after convenience checks they used were rejected for major purchases. In both cases, lenders cut their customers' credit lines, causing those checks to bounce. In addition to service fees from their issuing banks, borrowers faced penalties and collection activity from the merchants and banks where the convenience checks were presented for payment.

Typically, direct mail advertising campaigns take months to execute. As lenders made drastic changes to their credit card portfolios during the second half of 2009, many convenience check offers arrived on borrowers' doorsteps with already-outdated information. Other borrowers stashed convenience checks from the summer, hoping to use them during the holiday season. According to personal finance advisors, the credit line information on a recent statement or on a lender's website is the definitive guide to available credit. Even when checks boast promotional copy that includes a borrower's approximate available credit, consumers should review their credit line to avoid expensive and embarrassing transactions.