Best Credit Cards With No Annual or Foreign Transaction Fee
What’s the smartest way to shop for credit cards? Consumers who are new to the world of credit cards, or people who just want to find the best deals on cards, need to know where to look and how to hunt down the best deals.
There is no “perfect” credit card because they all have some types of fees or charges for usage, many of which can be well hidden within the red tape of the contract. Besides, each person has different goals when it comes to using credit. Some people want generous rewards programs, others look for low interest rates while still others might be seeking out “no annual fee” cards.
In fact there are eight common types of credit card fees, so it’s important to know how each one works and how you can shop for cards that have specific fee structures that match your spending habits. For example, if you’re looking for cards with no annual fees, there are several. Those same cards, however, might come with higher interest rates, big over-limit fees and other charges.
Here’s a quick rundown of what the eight basic fees are and how they work, followed by a list of tips on how to find “no annual fee” and other low-or-no fee cards to suit your financial tastes.
What’s What with Credit Card Fees?
Finding a no-annual-fee card is easy, but consumers should be aware that when a card issuer makes such an offer there’s usually a higher fee included somewhere else in the card’s contract. When you shop for credit cards, always take notes and find out about the following eight categories of fees for whatever cards make your “short list.”
Most cards will have the following fees, or some version of them. Other cards will have additional fees but the following eight are the main ones you’ll see as you shop for cards. It’s helpful to make a grid chart with the fee types listed on the left side and your favorite cards listed along the top. As you research each card, fill in all the fee amounts as well as comments about special features of the various credit cards. This winnowing-out process will help you see, at a glance, what each card offers, what its main advantages are and what its drawbacks are.
These are the interest charges on whatever balance you carry from month to month. Note that card issuers allow a “grace period” of about 22 days after the end of each billing cycle. During the grace period, you can pay off the entire balance interest free. The national average for finance charges hovers between 16 and 19 percent, which means that you could pay a lot toward interest if you carry a large balance.
Overlimit fees, once the monster of the credit card world, have been essentially legislated out of existence. However, consumers can still opt in to the overlimit charging system. If you do, and if you make a purchase that puts you over your credit limit, the issuer has the choice to let the purchase go through and charge you an overlimit fee of between $28 and $39. If you don’t opt in to the overlimit part of a card agreement, you won’t be charged an overlimit fee. Note, however, that the card issuer will deny any purchases you make that would put you over your card’s limit.
Balance Transfer Fees
Be careful about balance transfer fees. Some cards actually reward consumers who “bring in” balances from other cards. But that’s not always the case. Other card issuers charge fees in the 4 percent range for any balances brought from other cards. Always check on a card’s policy about these fees. They can be substantial.
Returned Payments Fees
By law, returned payment fees can be between $28 and $39. They are placed on your account if you make a payment on your card that, for some reason, does not go through. It’s important to always make sure that when you pay a card via bank account or check, the check is good and the bank account has enough funds to cover the payment.
Annual fees range from $0 to well in excess of $500. Card issuers charge these fees for a number of reasons. Some do it just to collect an easy profit from people who want their cards. Others use the annual fees to offset the company’s expense for perks like travel discounts, club shopping benefits and other “fringe benefits” that come with certain credit cards. But remember that it is possible to get no-annual-fee credit cards that offer generous rewards programs, so it pays to shop around.
Cash Advance Fees
When you use a credit card to obtain cash at an ATM or bank, card companies charge anywhere from 1 percent to 7 percent of the cash amount as an upfront fee. Avoid these fees by never using your card to get cash.
Foreign Transaction Fees
When you travel outside the U.S. and make purchases on your credit card, the issuer will often charge a fee on each transaction that takes place in the other country. It’s usually in the range of 2 to 3 percent. If you travel internationally, find a card with low or no foreign transaction fees.
Late Payment Fees
Most cards have late payment fees and some are quite steep. By law, most standard late payments can’t be penalized more than $39, but if you are more than 60 days late the issuer has more options. The solution: always pay credit card bills on time. Pay entire balances within the grace period to avoid finance charges and late payment fees.
Know which fees will most likely affect you and which ones likely won’t. For example, if you seldom travel you might not worry about having a card with high foreign transaction fees. Consumers who pay off their card balances every month won’t be concerned about finance charges. Consumers who never miss a payment might never see a late payment fee. Much of the “search for the perfect credit card” has to do with your personal preferences and spending behavior.
How to Find Credit Cards With No Fees
There are two ways to find credit cards with no fees or very low fees: online searches and asking company representatives to waive or lower fees in exchange for your business.
Before you begin, you need to identify which fees you want to minimize. If, for example, you want to locate two different cards, one with no annual fee and one with a low finance charge, first decide on your numeric ranges. Let’s say you seek a finance charge of 15 percent or lower on one card and an annual fee of $0 on the other. For the moment, we’ll assume you don’t care about rewards, foreign transaction fees, overlimit fees or other charges. Employing the two methods, you’d do the following:
Method One: Online Research
The Internet is literally awash in credit card information. A simple search on terms like “credit card deals,” “low fee credit cards,” “best credit cards for 2019/2020” and “no fee credit cards” will turn up hundreds of useful articles, most of which include comparison charts, graphs and other graphics to help you decide what card is best for you.
When doing a search like this, remember to note the date of the article. Card terms and “deals” change often. That “no annual fee” card featured on an authoritative website two months ago might currently have an annual fee. It always helps to verify any information you find in a side-by-side comparison chart of different credit card charges.
Also keep in mind that an apparently objective article about credit cards might have been funded by a particular card issuer. Always try to stick with the financial websites that you trust.
However, using an authoritative website that has recent information about credit cards is a good starting point. Locate cards, per our example, with no annual fees and finance charges at or under 15 percent. It should be easy to find at least three cards in each of those categories. Write down the names of the cards, the address of the issuer’s website and the phone number of the issuer. You’ll need all this information later on.
Verify all the data for each card by calling the issuer or viewing the corporate website. Most companies that issue credit cards will include a page on their site where the legal “fine print,” or card contract is featured. Expand your page and read the terms of the contract. It will contain all the data you need.
At this point, all you need to do is decide which no-annual-fee and under-15-percent finance charge credit cards look best to you. Some consumers like to call the card’s customer service number and see if the rep is polite and informative. It’s just another way to ferret out the very best cards. Don’t forget that you can combine this method with the next strategy for optimal results.
Method Two: Call the Card Issuer
If you have a favorite credit card on your wish list but its fees seem too high, it’s possible to call the card issuer directly. Explain that you are seeking, for example, a no-annual-fee card, or one that has a finance charge of 15 percent or less. Say that you’d like to sign up for their card if the fees were lower. Many card companies will waive a particular fee if you agree to transfer a balance to their card.
Sometimes they’ll simply reject your proposal, but it never hurts to ask. Many consumers have been able to shave a few points off annual fees, overlimit fees and other fees just by calling and being pro-active with the credit card rep.
The Final Word on Credit Card Fees
Be an informed consumer when it comes to credit card fees and charges. Never be afraid or in too much of a hurry to read card contracts. Information is power, especially in the credit card market. As long as you know what you want and know what types of card offers are out there, you’ll be in an ideal position to snag the very best credit card deals and save plenty of money in the process.
General No Annual Fee Credit Card Questions
This section answers the basic questions people have about no annual fee credit cards.
What does annual fee mean on a credit card?
An annual fee is a fee credit card companies charge you every year to cover the costs of servicing your account.
Do all credit cards have an annual fee?
No, there are plenty of credit cards with no annual fee or that will waive your annual fee if certain conditions are met.
How to avoid annual fee on credit card?
That depends on your specific credit card. You’ll need to talk to your credit card company to see what you can do to get your annual fees waived in your situation.
What is the average annual fee for a credit card?
In 2018, a study found the average credit card annual fee to be about $147.
How to get rid of annual fee on credit card?
There are a few options for most people to get rid of your annual fee. You’ll need to contact your card servicer to see which options apply to your case.
Will credit card companies waive annual fees?
Yes, in many cases a credit card company will waive an annual fee. You’ll usually have to make all your payments on time and meet other qualifications to get the fee waived.
What is no annual fee credit cards?
A no-annual fee credit card is one that doesn’t include a charge every year for the costs of servicing your account.
Specific Credit Cards and Fees
We’ll answer your questions about specific credit cards and fees in this section.
What is the best credit card with no annual fee?
The best credit card with no annual fee depends on what you’re looking for a card. People that want cash back might try the Capital One Quicksilver card, while those looking for miles may want to try the Chase Unlimited card.
Does PayPal credit card have annual fee?
There is no annual fee for the PayPal CashBack Mastercard.
Does Southwest credit card have foreign transaction fee?
There are no foreign transactions fees on the Southwest Rapid Rewards Premier card, but the Rapid Rewards Plus card has a 3% foreign transaction fee.
How much is Square credit card fee?
The Square fee for credit cards depends on the amount of the transaction and how many transactions you process a month. It ranges from 2.75% to 3.75%.
What is QuickBooks credit card fee?
QuickBooks charges 2.9% for invoiced cards plus an additional $0.25 per transaction.
Does Capital One credit card have foreign transaction fees?
No, Capital One does not charge a fee for using your credit card for foreign currency transactions, but they will convert the transaction at the exchange rate in effect at the time of processing.
Which Chase credit card has no foreign transaction fee?
Several Chase credit cards have no foreign transaction fees. One of the most popular is the Chase Ink Business Preferred card, which has an annual fee of $95.
Does Alaska Airlines credit card have foreign transaction fee?
Both Alaska Airlines credit cards have no foreign transaction fees to use them in other countries.
Does Capital One credit card have annual fees?
That depends on the Capital One card. Many of the Quicksilver cards and their Platinum cards have no annual fees, but others, like some of the Venture cards, do.
Does Discover credit card have an annual fee?
Discover credit cards don’t have an annual fee for their cash back, travel, business, student, or secured credit cards.
Does Indigo credit card have an annual fee?
Yes, Indigo has an annual fee of $75 for the first year and $99 each year after that.
Does USAA credit card have foreign transaction fees?
Not anymore. There used to be a 1% transaction fee on some USAA cards, but that has been discontinued since 2016.
Does Wells Fargo credit card have foreign transaction fee?
It might, depending on the card. If it does have a foreign transaction fee, then that fee is 3%.
Other Types of Credit Card Fees
This section covers some popular questions about other kinds of credit card fees.
What is a credit card transfer fee?
A credit card transfer fee is the amount you pay to move your balance from one credit card to another credit card.
What credit cards have no foreign transaction fees?
Many credit cards have no foreign transaction fees. Alaska Airlines, Capital One, Chase, and others are all options.
What is a transaction fee on a credit card?
A transaction fee on a credit card is a fee that you paid to use the card. The exact nature of this fee depends on context.
Which credit card has no balance transfer fee?
Chase, Bank of America, Wells Fargo, Citibank, Capital One, and Southwest Airlines all offer credit cards with no balance transfer fees.
How to avoid foreign transaction fees on credit cards?
The best way to avoid foreign transaction fees on a credit card is to not use a credit card with foreign transaction fees. Speak to your credit card servicer and see if there is anything you can do to modify the terms of your agreement.
Is there a credit card with no balance transfer fee?
Yes, there are lots of credit cards with no balance transfer fee. You can get them from Capital One, Chase, Wells Fargo, Citibank, and more.
Will credit card companies waive late fees?
In some instances, yes. You’ll need to talk to your card servicer and explain your situation to see if you can get your fees waived.
How to pay rent with credit card no fee?
You’ll need to talk to your landlord to see what kinds of payment methods they accept to determine how to pay your rent on a credit card with no fee.
How to send money with credit card no fee?
The only way you can send money with a credit card with no fee is if you have a card that doesn’t charge a fee for cash advances. You should also expect a fee from whatever clearinghouse service you use to wire the money.
What credit card has the lowest balance transfer fee?
Bank of America, Wells Fargo, CitBank, Capital One, and Chase all offer credit cards with a zero balance-transfer fee.
Will credit card companies waive balance transfer fees?
Usually, a credit card company will be willing to waive a balance transfer fee. You’ll need to talk to your credit card issuer to see what you can do to remove this fee.
What is credit card interchange fee?
An interchange fee is a fee paid on a merchant’s bank account when a customer uses a credit or debit card at their store. It’s used to cover costs assumed by the card-issuing bank.
Other No Annual Fee Questions
We’ll answer questions about credit card fees that don’t fit into our other categories here. Check this section if you can’t find your question elsewhere.
Are credit card fees tax deductible for businesses?
It depends on the type of fee and the card. The card must be a business card used for business purchases. Most fees, including annual fees, late fee, and more, are tax deductible.
Which credit cards waive annual fee for military?
American Express and USAA are the two most popular credit cards that offer no annual fee for military members or vets.
Which is not a common credit card fee?
There are lots of things that aren’t common credit card fees. That’s why it’s important to do comparison shopping before signing up for a credit card. This will help you understand if you’re getting a good deal or not.
Financial Advisor - Best.CreditCard
David is our in-house financial advisor with years of experience in the credit card industry. He became interested in credit cards after working for several years at a major bank. He holds a Masters Degree in Finance.