I don't single out too many credit cards here at CreditMattersBlog.com, but Charles Schwab has rolled out a new credit card that may be of interest to some of you. Hat tip: persevering. Plus, Bob Wang (a reader) wanted me to do a write up of this card. How can I turn Bob down? Anyhow, the card's name is a bit unwieldy, so I'll call it the Schwab Invest Visa card. There are two features that stand out with this card: the ability to earn 2% cash back on all purchases (unlimited) and no foreign exchange fees.
Here are some of the features from the credit card:
* No limit on the cash back you can earn.
* No minimum monthly purchase amount.
* No annual fee or foreign exchange transaction fees.
If you receive an initial credit limit of $5,000 or more, you will also receive Visa Signature benefits as well. Fine-print alert: If your account does not receive an initial limit of $5,000 or more, you'll receive a platinum plus account. Whether you you receive Signature benefits or you get the platinum plus account, your cash-back rewards and other perks are unaffected. The initial limit will only determine whether you also receive Visa Signature benefits as part of your Schwab card.
Now, here is where the 2% cash back comes in. In order to receive 2% cash back on all of your purchases, you must open a Schwab One brokerage account. If you don't open a brokerage account, your card will not be able to generate cash rewards. Instead, you'll be put on a points program. According to Schwab, "the Schwab One brokerage account has no monthly service fees, no minimum balance requirements, low-cost trading, plus 24/7 online and customer support." Therefore, Schwab has made it easy to receive the 2% cash back. You simply open the brokerage account and start enjoying your 2% cash-back card.
While, you're at it, you may want to open a Schwab high-yield investor checking account, too. There is a combined application for the brokerage and checking account, which can be found here (link).
Here are some of the checking details:
Also, there are no minimum balance requirements and there are no account service fees. You can open the checking account with $0.
With that out of the way, here are my warnings. I would assume that you'll receive a hard inquiry for each product that you apply for. This card is underwritten by FIA Card Services, Bank of America's subsidiary. FIA/BOA is well known for pulling Experian -- though it varies, I imagine, by geography. If you apply for all three products, I would assume that you'll receive three hard inquiries. And even though there is a dual application for the brokerage and checking account (using the link I provided above), I'd just count on there being a separate pull for each product. If you only receive one inquiry for the dual application, great. But don't count on it.
Details of the credit card (including the application) can be found here (link).
After you've applied for the Schwab credit card, you can check the status of your application here (assuming you don't receive an instant approval): Schwab credit card application status (link here).
Good luck to those who apply for the card.
Wednesday, December 3, 2008
Schwab Bank Invest First Visa Credit Card
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97 comments:
If you have a 10k limit then what does "No minimum monthly purchase amount" mean in this case?
Thanks for putting the information in one convenient place Marcus!
Yeah, word of this credit card did come up on CB, but when I've visited Charles Schwab's website and looked around, I couldn't put it all together.
Once again, thanks!
And yes, this card is indeed different from the Schwab Worldpoints Card.
Now, the question remains: For how long will it last?
Hk, that you don't have to reach a certain tier on your spending to get the 2% back. Every dollar qualifies. Lots of cards don't kick off cash until you have spent a particular amount on the card each month.
Schwab is just saying that you will earn cash back on every dollar you spend.
Azn, sign of the times. Benefits are here today and gone tomorrow.
They'll last until they don't. Ha! No one can know.
At least right now, desirability index is VERY high.
Yep. Agree. If I wasn't making a major purchase in the next three months, I would go for this card.
Does it cost anything to pull money out of the Brokerage account? Do you have to find a Schwab place to get the money? I'm assuming they will count on people keeping the money in the account so they can use it, since it'll take work to get the money out.
Anyone know if BoA will let you convert an existing card to this?
Brian, not sure. You might want to give them a call. In the past, I think it's been difficult to convert Schwab cards (they're on a different program). But do give them a call. Let me know what they say.
Anon, not sure about that. I would give a customer service rep a call. They can probably answer that question off the top of their head.
CM, what you buying? :)
Shoot me an email, Josh.
Does anyone have this card? I am seriously looking into getting it as my daily card. The 2% cash back is looking pretty nice.
It's a new card, Ryan. I don't know anyone who has it. As I said earlier, I'd get it if I wasn't getting ready to buy something (on credit).
Very frustrating...I applied (and was approved) for the card, and I've opened the brokerage account. I'm getting mixed reports on whether opening the checking account will in fact generate yet another hard pull. Can someone who's gone through this process in the last couple days chime in? They're being very vague about whether having the credit card linked to the brokerage account makes it exempt from the $1,000 minimum - the reps say no, ONE spot on the site says yes. If I don't need to open the checking account, I won't, but I can't get a good answer. Sigh :)
Brian, I always assumed that you would get a pull for each product. None of my readers have told me yet.
Per the information from the site, you did not have to open the checking account. Said that you just needed the card and the brokerage account to receive the 2% cash back.
I would escalate to a supervisor, Brian.
Thanks for the feedback - I know I don't have to open the checking account to get the cash back - what I'm unclear about is whether you need to have the checking account to avoid the $1,000 minimum opening deposit for the brokerage account, or if the credit card will accomplish the same. According to http://www.schwab.com/public/schwab/banking_lending/credit_card/credit_card_faq.html,
"Do I have to pay for a Schwab One account?
There are no monthly account service fees and no minimum balance requirements for the Schwab One account when it is linked to your Schwab Bank Invest First card. Standard pricing for equity trade commission rates starts as low as $8.95, and transaction fees may apply. Refer to the Charles Schwab Pricing Guide for more information."
BUT, I've been told by several folks on the phone that you DO have to have the checking account in order to avoid the minimum. This page (about the brokerage account), http://www.schwab.com/public/schwab/home/account_types/brokerage/s1_brokerage_account?cmsid=P-2070537&lvl1=home&lvl2=account_types&, for example, states,
"Schwab Bank High Yield Investor Checking accounts are only available as linked accounts with Schwab One® accounts. There are no minimum balance requirements, minimum balance charges, or minimum trade requirements in order to open or maintain the Schwab One brokerage account when you also open a linked High Yield Investor Checking account."
There is no reference to the credit card and what, if any, affect this has on the minimum requirements.
Brian, my guess?
That the site has not yet been updated to reflect the new credit card. You are looking at part of the site that has not yet been made current. Just my guess.
I have written about changes to credit cards -- and then I go to see if the card companies has made the changes. Often, no change has been made, even though I already have the information about the new changes.
Seriously, I would talk to a supervisor. Say you have the credit card and the brokerage account. Ask if that's all you need to do to avoid the minimums. If they say no -- then cite the language you found on the Web site.
I did just that a minute ago - although I didn't get specific clarification on this, I was told (as I was also told earlier tonight) that they pretty much don't charge fees or enforce minimum requirements. This is great, but I'd prefer the official terms and conditions to support it :)
Brian, I am with you. I would like to see official terms. The card site seems to be official, and it says no minimums, but I understand your point. You need a letter! Haha. Tell them to send you a letter that binds them. Hehe.
I do have to say, of the 3 rep's I've spoken with tonight (I'm talking Schwab, not BoA), every one of them has been incredibly helpful and professional. This is from the same toll-free number that both new customers and existing use - it seems that they are a company that actually wants to go the extra distance to get and/or keep your business. When using online chat, the rep and I got to a point where he couldn't help online, so he called me, and transferred me directly to a person (who gave me his direct desk line) that was able to help. Impressive!
Brian, that's great. I've heard that the operators that handle Merrill and Schwab are dedicated to those cards. As a result, they know their stuff.
Let me know if you ever get a definitive answer.
Brian, I would be interested as well in regards to what happens... keep us posted!
On a side note, great site CM I have been reading everyday for the past 3 months or so!
I'm also hoping that Brian will check back in. Brian is an early adopter so we'll need people like him to fill us in.
Ryan, glad that you're enjoying the site. If you've been around for three months, you're an old timer! LOL.
Thanks for supporting the site.
(If I missed this elsewhere on your site, I apologize.) The Schwab checking account offers an ATM/Debit card that rebates ALL ATM fees, worldwide. We have used it successfully overseas and in the U.S. Schwab's customer service has been first class every time we've contacted them. For international travel, this new Visa combined with the ATM card would be a killer combo. Just applied for the Visa card, and approval is "pending."
Ken, no worries. I mentioned in my story that the ATM fees are reimbursed worldwide.
I appreciate the note, though.
Good luck on the application. Hope you get it.
Still nothing in writing, but I'm being assured by EVERYONE that there are no minimum balances required or enforced.
Brian, thanks for checking back in. From everything I've read, there should not be any minimums.
So anybody tried to apply?....
Brian (above) has applied. He was approved. Not sure who else has applied, though.
If you not mind,would like to ask,what credit limit got Brian , what was his credit score and which bureau they pulled...Thanks
We'll have to wait for Brian to come back. He never mentioned the limit and never mentioned which credit report was pulled.
I'm always around ;) Credit score is in the mid-700's, BoA (for the credit card) pulled Experian, and Schwab (for the brokerage account) pulled Equifax. I did not apply for the checking account right now, but I've heard that will probably be an EQ pull as well. Limit was just above 10k (they matched my lowest current CL - I'm thinking this is probably a coincidence though). I've heard of people getting approved for this card with CL's as low as $4000, and as high as 25k.
Sorry about the deleted comment - had to make a correction and there's no way to edit :)
Brian, thanks for the follow up.
After you get the card, you should ask about a CLI at activation. Tell them that it's kind of on the low side (based on your other cards). Kind of tough to make it your every-day card when you are worried about utilization on a low-limit card.
Just don't let them pull a new report to give you the increase.
Was approved for what I think of as a fairly low (11K) credit limit. (Have another couple of Sig Visas with CLs in the mid-to-upper 20s.) Current credit score right around 800. Have been very pleased with the Schwab checking account and ATM with no forex fees. Customer service again was very good.
Thanks, Ken. Looks as though Schwab is granting some fairly stingy credit limits. Good to know.
Heya, Ken. Shoot me an email real quick. plastic101@gmail.com
I don't think I'll be asking for anything right now, especially since I've already got a few good CL's with BoA. Since this is a signature card, there shouldn't be a utilization problem even if I do go a little higher than normal on occasion.
Brian, good point about the signature aspect of the card not impacting the utilization. As long as they're coded correctly, the signature cards don't hurt.
Just checked and found out that I was approved with a $5000 credit limit. FICO score of 752.
Good. You just made the cutoff too. Any limit below $5,000 does not get the Signature card. Instead, you would have received the Platinum Plus card.
Congrats.
752...?.and only $5,000 CL granted...What a joke?Nice treatment from BoA:)
$14,700 with 760 score!
Nice approval, Anon.
There should be no difference between 752 and 760 credit score,so have no clue why such big difference in credit lines granted.
Anon, the missing link is likely income. Income was probably what got the $14,800 limit.
I got approved with a paltry $1000 with a 772 credit score.
Anon, that means you also won't get the Signature card. You'll get the Platinum Plus card. $1,000? What does Schwab expect you to do with that?
I have no idea. Earn a max of $20 cash back per month unless I pay off the statement as I go, which I think would be too much trouble.
Based on the listed benefits of the Signature card, I don't think I'd use them anyway. So that's okay.
But this is not shaping up to be much of a competitor to my AmEx blue cash card unless my limit goes up soon.
You need to get on the phone with Schwab and let them know that this limit is unworkable. You were hoping to replace your Amex Blue Cash but it will be impossible with this kind of limit.
See if that does the trick. DO NOT let them pull a new credit report. They can reevaluate using the same one.
Checking back in, I got the limit raised to $8,000, a significant improvement. They suggested waiting 4-6 months until asking to raise it again if I desire.
Thanks for the suggestions!
Hi, I get only 2k credit line with 73x credit score. I tried the same trick but they insisted that the only way is to pull my credit report. No luck..
Hey, Just wanted to let everyone know that the Signature version shows up as Type: Flex Spending (on Experian). Is that similar to the "Open" that you were talking about CM? Do you anticipate any effect on utilization/credit score?
Scott, you have no problem. My Saks Fifth Avenue MasterCard reports that way. My limit gets reported. And utilization is not an issue.
One question, Scott: Can you see the limit on your Experian report?
Right now it just says N/A, but I haven't even received the card in the mail yet to activate it.
Scott, I don't like how that sounds. My Saks card reports the limit AND says flex spending. It doesn't say N/A.
Most Signature cards do not report the limit. But then most cards do get reported as OPEN, which doesn't hurt utilization. Keep an eye on the account.
Also, do you have a lot of other cards? Do you have enough available credit so that this one card won't hurt you?
I'm at about 15% utilization right now and made some larger purchases than usual this billing statement. Maybe the N/A will get replaced once the card is activated and used... I would like to switch over and use this card as my main one.
Scott, activate the card. See how it reports next month. Let me know if there is any impact on your score after you let a balance report on the card.
My guess is that the Flex designation will act like an OPEN account. Flex is really just another way of saying "no preset limit." We shall see.
Hey Everyone,
I'm a reporter with Marketplace, a business show on NPR. I'm doing a piece on savings/retirement credit cards and was wondering if there is someone who is using one of these cards who might be willing to talk with me. My email is svaneksmith@marketplace.org
Thank you!
Stacey
Stacey, shoot me a note at plastic101@gmail.com.
You'll get your message out a lot easier if you contact me. I can then publicize your request.
Anyhow, shoot me a note.
Anyone able to convert a regular BofA card to the Schwab Bank Invest First?
Anon, I haven't heard of anyone doing that. My guess is that it's not possible. It's probably in a different program so BOA will not allow a conversion. It will require a new application. I remember, back in the day, when I wanted a Merrill card and a Schwab card. BOA told me that I was unable to convert my existing BOA cards into either of those cards because of the program requirements. It would require a new application.
My guess is that it can't be done. However, I always recommend that people call. BOA should be able to answer this question within 10 seconds.
Anon, if you do call, feel free to chime back in.
Thanks.
Anyone know if Schwab pulls a dual report for the checking/brokerage combo?
Any know what bureau for the brokerage?
I've heard that it's Experian. I also hear that there will be a hard pull for each product.
I really want to open that combo, first because the checking account is great plus I need the brokerage for the cashback but they confirmed as you heard, two pulls.
I don't know. I already have a lot of inquiries, I just didn't want another two.
Josh, you're a stalker. I can tell you really want these accounts. Eventually, you will get them.
Let me know what happens.
I applied last night for the combo and the account numbers were generated today. The rep did say they are still verifying the account under the "patriot act" but I have ZERO inquiries thus far on my Experian CR. I wonder if they pulled from Equifax, because the online verification questions were pulled from Equifax.
I sure hope so, my Experian report is loaded with inquiries ;)
I just have to say though, that over the course of now 10+ convos with reps, that their customer service is simply amazing. Even the credit card side of things is great, I wonder if they get premier service from FIA for Schwab cardholders.
When I speak to Schwab directly, it's amazing, they are all from the USA and in fact for accountability they even tell you which call center they are in.
I'm pretty darn impressed.
Let me know, Josh.
I have a Merrill card. It's through FIA. The service is top notch.
Schwab pulled two from EQUIFAX for the checking and brokerage accounts.
I was dinged on EXPERIAN for the actual card though, from FIA.
J, thanks for the update.
Also got hit for two Equifax and one Experian, Applied in Feb. Approved for brokerage and checking right away, denied for credit (took a gamble at playing Russian roulette).
For the credit card, instant denial (had to wait 7days to learn that denied due to having "sufficient credit".)
Called up Charles Schwab customer service asking to speak to a credit analyst and he did total analysis of income vs debt as well as future earning potential.
Asked a whole bunch of questions regarding college graduation date, job offers etc. Reiterated that I always paid in full and confirmed the payment amount on my BOA credit cards (matched exactly penny for penny to amount reported on credit report). Whole process took about 20min.
Also mentioned that exposure is nowhere near what BOA has set (38% I think?) and that by issuing me credit it would be beneficial to BOA to make some money through merchant charges.
After running the numbers he said I was approved for the 5k Signature card. Haven't received the actual card yet but should be getting it this week (Showing up under my Schwab one page; requesting account number to complete setup process).
Initially when I made the call I was going to ask just to approve me for $500 and then transfer the limit from the BOA card. Glad I didn't.
Next step Apply for Merrill+ card in 2011. Other than that mature and expand this card and Penfed to larger CL.
To the readers who got the Schwab card, how does it report on your credit reports? Does it report the hard limit or no limit at all?
BTW: I swear Schwab sends out a requisites tree to be chopped down per customer to print all the welcoming materials. Another thing I like about them (apart from 2% rewards) is the logo design (not as great as the bull but still classy).
correction to the above post only got approved for $2500(showed up on credit report) should I ask for $5k during activation even though I am a student currently?
Does schwab backdate accounts like amex? Its showing up as 2009 date as opened.
Schwab should not backdate. I have not heard of it doing that.
Can you reallocate a Bofa cards credit line to this FIA card?
Anon, you should be able to. Give Schwab a call and see if they'll take your BOA limits and move them to your Schwab card.
I was able to do it with my Merrill card (FIA). Moved by BOA limits to that card with no trouble.
CMB, did your card history carry over when you moved your BOA limits? Eventually I just want to combine the cards and want to make sure from users that they were able to combine successfully.
Anon, no. Here's how it worked:
I had to apply for the Merrill card. New card. New history. I then took my BOA limits and moved them to my Merrill card. I ultimately closed my BOA cards. Luckily that was no big deal for me. The BOA cards were not very old.
But in the end I didn't have any open BOA cards (though they still continue to age for FICO purposes) and I had a new Merrill card (which is now coming up on three years old).
Scott, did the limit ever report?
What happens if the limit does not report? As long as its coded as a signature card it's ok right?
If I have a signature card, do I still have to worry about utilization? i.e. if I charge close to the limit, and PIF but let balance report? I know FICO might not look at it, but would other creditors be couscous of the fact that it's a signature card or balk at the fact that it still looks maxed out?
In terms of closing out accounts. So the history stays for 7 years? i.e. if I have a bofa card that has a few years history and is my oldest card....utilization for me is not an issue. As long as the history still counts for me for up 7 years, I can safely close it if I have other accounts that were opened close to that time frame?
An account in good standing will stay on your report for about 10 years -- after you close it, Anon.
Other creditors won't know if you have a Signature card, but they will realize, if they look at the credit report, that you have some kind of card that does not report the limit.
The kind of card you have does not get reported. However, what is important is that the card report as OPEN -- as opposed to REVOLVING. The OPEN designation tells FICO to exclude the card from the revolving utilization figure.
I received a $20,000 CL with a score of 794. There was one hit on Equifax for the brokerage account and one Experian for the CC and another on TransUnion for the CC account. The CC is showing up on Experian without any indication of a limit or an "open" status.
I was rejected for the credit card because I've only had my current AMEX for two years. Credit score in the mid 700s. I've paid student loan payments for 7 years but I guess that didn't matter.
Anon, strange, because I was approved for the card with scores in the mid 700's and just a few cards that were all in good standing but were obtained just 6-7 months prior. Call the backdoor for an analyst.
If I were to apply for this card how much do you guys think I would be approved for? I am 21, a student, making about $20k-$25k per year, 3 open credit cards and no more than a $500-$1000 balance over $5k in avail credit with my longest credit card being about 3 years old and one credit card opened within the last 6 months. I normally pay my credit card bills off at the end of the month but i got a nice 0% deal on something I neede to but which is the only reason that I am carrying a balance. And BTW I also just opened a schwab brokerage, checking and savings acct in april. I wanna say that my credit score is prpbably about 700-740.
Anon, it's difficult to know what you'll get approved for -- if at all. However, if you do not get a credit limit of at least $5000, you will not get the Signature card. You'll get a plain-vanilla card instead.
That said, given that you do have a relationship with Schwab already, you might be in a better position.
But, seriously, just too many variables to know if you'll get approved. On the surface, you do not look like a presumptive decline -- so that's good.
Only way to find out is for you to apply.
Any chance they would approve a College Student with no Credit History for the platnium plus account?
Anon, difficult to know. I'd call and talk with an analyst. See what the analyst says.
Anon,
As you are a college student, I ask if you have any student loans? If you do, you have some credit history there.
With no credit cards, I doubt it unless you have a significant banking relationship with FIA which is Bank of America.
I was approved with 6-7 months history(cc etc.) with a relationship with the bank after being denied initially and speaking with an analyst.
I think Josh's answer is excellent. But I would say that there is no downside in talking with an analyst.
As a college student with no credit history I was approved for a visa plus card with $700 in credit. How soon should will it take my credit limit to increase?
I'd likely wait 6-12 months. That gives you a chance to establish your purchase and payment history. Easier to ask for a CLI when you've proven yourself.
Though I was only approved for $700 I was sent the Visa Signature Card. I am so happy about it!!
I was only approved for $1000 yet I also received the Visa Signature card. I'm NOT complaining! :-)
I have this card & I love it! I already had a brokerage account with Schwab so it was a no brainer to get the card too. I just got my first cash rewards earlier this month. Every month a few days after the 1st the rewards are deposited into my brokerage account.
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