Posted by Chuck on October 1, 2014
Free money

Published on October 1st, 2014 | by Chuck

212

Small Balance Credit Card Waiver (Lots of Free 99¢ Amazon GCs)

Did you know that some banks will waive your credit card bill if it just has a very small balance on it?

Small Balance Waiver

With many credit cards, if the balance on your statement is small – usually 99 cents or less – the bank will forgive it; it’s too small to ask you to pay. Usually it shows up on the bill as a “credit adjustment” or something similar.

Here’s the data that we’ve found so far on how much will be forgiven:

  • Amex – none (however, this seems to vary – some people get $1 waived or even more.). Recent DP of this.
  • Bank of America – none (occassionally, they do waive as much as $4.75)
  • Barclay will forgive $.99 (update: seems they now forgive $1 as well) (a reader reports that Barclay business cards do not forgive $.98)
  • BBVA Compass will forgive $1 (source)
  • Best Buy Citi will forgive $.74 (probably up to $.99) (1), another reader reports (12/23/18) them not forgiving $.99
  • Capital One will forgive $1
  • Chase – none (As of November 2014, Chase is no longer forgiving small balances; however, some are still reporting success.)
  • Citi – none (one report of a waiver for $.27)
  • Citizens Bank forgives $.99  (ymmv)
  • Comenity Bank no longer forgives $1.99, unclear if they forgive at all (source)
  • Crate & Barrel will forgive $1.50
  • Credit First will forgive $.99 (source)
  • Discover – Most people get waived up to $2. (In 2018, some people stopped getting that waiver.)
  • Elan (Fidelity) will forgive $.99 (1)
  • FIA – none
  • Fifth Third Banknone
  • FNBO Omaha Amexnone
  • Home Depot card will forgive $.99 (source)
  • HSBC – none
  • Kohl’s card will forgive $.99
  • M&T will forgive $.99
  • Macy’s Amexnone
  • NFCU: none
  • PenFed will forgive $1
  • PNC – none (won’t forgive $.99)
  • Sears Citi will forgive $.99
  • Suntrust – none
  • Synchrony – none (one report of a waiver here)
  • Target credit card none
  • US Bank – will forgive $1 [Note: they will not forgive the small balance in the month that you are charged $0 for the “annual fee”, but the other 11 months you should get the $1 forgiven.]
  • USAA forgives $.99
  • Wells Fargo will forgive $1.99

Some of this info is based on my own experiences (see below), and some is based on readers comments to this post, on this Reddit thread, and on this FatWallet thread.

How to Use It

This may not sound so easy to make use of, but consider the fact that Amazon allows gift cards to be bought for as little as 50 cents. So after you go through the pain of setting up all your credit cards in your Amazon account, you can just go one-by-one and buy 99 cent e-gift cards on each credit card once a month.

This is especially worthwhile on no-annual-fee credit cards which you are planning on keeping forever; the two minutes you spend adding the card to your Amazon account will get a lot of usage.

This is best used on sock-drawer credit cards; since there’s no balance on the card, you can just purchase the $.99 Amazon gift card and you’re done. But it’s also possible to make use of this on credit cards which you do regular spend on. You can pay off the bill besides 99 cents, and the small balance will be forgiven. This may be considered a hassle for some, but some of us are anyway paying off our credit card balances early so that our credit utilization ratio goes down (see below).

Effect on Credit Score

We know that 30% of the FICO score is based off your credit utilization ratio. We’ve written that anecdotal evidence suggests that the sweet spot for optimizing your utilization ratio is to have zero utilization on all your credit cards, besides for one card which should have a utilization of something under 10% of the credit limit on that card.

How will this $.99 trick effect your credit score? If you leave a $.99 balance on numerous credit cards, will the $.99 balance show up on your credit report and hinder the above mentioned sweet spot?

No. Based on what I see on my own credit report, I believe that for two reasons this will not hinder your credit score at all.

Firstly, in general the balances always get rounded down to the dollar. So if you have a balance of $532.99, it shows up as a $532 balance. In our case, the $.99 balances are showing up as $0 on my credit report, just as all balances are rounded down to the dollar. I would therefore assume that your utilization ratio remains zero.

Additionally, since the credit card issuer is waiving that small balance, they report it as a balance of $0; the waiver is factored into the balance reported. I see this from the balance reported on my Discover card. As mentioned, Discover waives up to $2. On my credit report the balance is showing up as $0, despite the fact that there was actually a $2 balance. Apparently, since they are waiving the $2, they don’t report that balance at all.

Since there are many credit cards which don’t waive small balances, you can use one of those to be your one card which carries a balance, and all the cards which are carrying $.99 balances will be considered as having a zero balance. We’ll thus be able to retain the optimal utilization formula even while playing this $.99 game.

Some Screenshots

Discover

Discover has the highest threshold – they’ll forgive up to (and including) $2, but not $2.01.

discover1$2 is forgiven

 

discover2

$2.01 is not forgiven

US Bank

US Bank forgives 99 cents.

usbank99cent

 

I’m pretty sure that they would not forgive $1, but I haven’t tried it.

Barclay’s

I only recently got a Barclay card (the Arrival), and I noticed in the pamphlet that came with the card that they’ll bill me for any balance of $1 or more. They didn’t say if less than $1 will be forgiven, or if it will roll into the next bill. I tried it out, and…

barclay 99cent

the 99 cent balance was forgiven.

 Amex, Fia, Citi, BoA, Synchrony

These card issuers don’t seem to forgive anything.

amex2

A recent Amex statement

citi9cen

A recent Citi bill with a 9 cent balance.

 

fia99cent

From a recent FIA Amex statement.

synchrony99cnet

From a recent GE/Synchrony statement

As for Bank of America, I have no personal data since I don’t have any BoA credit cards, but I believe it runs through the same Fia Card Services, same as my FIA Amex mentioned above which did not forgive a $.99 balance. The Frequent Flyer reports likewise that BoA did not forgive a $.50 balance.

 Our Verdict

We’re obviously not getting rich on this, but it sounds like a cute way to get $5-$10 in Amazon gift cards per month with minimal effort. Please comment below with any additional (current) info, and we’ll update the post to reflect the additional information.

It’s worth noting that some banks might not take kindly to this, so keep in mind the small risk. Doing sporadically should be fine.



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Bruce Wayne
Bruce Wayne

doc any idea about Wells Fargo?

LC
LC

yeah its $1.99, but i realize this was 4.5 years ago you asked lol

Stephen Lioy

I assume that means no points awarded on the balances?

Mordy
Mordy

I have to disagree with 2 of them, both with which I had experience with in the past 2 months
1) Amex forgave me $2
2) Discover made me pay a $1 they forgave me the previous month in the next months statement

amex
amex

i had amex bill closed on .03

Chase

What about Cap One?

Ren
Ren

This happened to me with a Kohl’s card for an amount less than <$1.
It was a year or two ago. Sorry, I don't have access to that account any more.
Kohl's Credit was administered by GE Capital, but they are now serviced by Capitol One (ugh).
I don't remember who was servicing it at that point.
So, it could apply to any private label card from GE Cap or Cap1.
Sorry for the light info, that's all I have.

Albrecht
Albrecht

Years ago I was charging .99 at Kohls on my store card until I got tired of asking the cashier to charge .99 on the card and see them screw it up and charge the complete amount instead.

It just happens that a couple of months ago I started experimenting again with my set of credit cards and found the following:

Capital One will write-off .99
Citi Sears will write-off .99
Discover will write-off 1.99
Penfed Visa & Amex will write-off .89

Sam
Sam

Yup! Chase no longer forgives 0.99… In fact they just closed one of my bills on .02!!!
Thanks for the updates.

jj
jj

Here’s some clarification on the mixed US Bank reports: you will get the 99 cent balance forgiven 11/12 months of the year, but not the month where you are also charged a $0 “Annual Fee”.

Harold
Harold

My experience with US Bank is that if you charge exactly 99₵ during the month then you don’t get the small balance credit. But if you charge more and pay off all but 99₵ then you do get the credit. Now, I will need to try getting that extra penny from them every month.

Adam

anyone else try this after getting a new USB card? I can try now, and see how the first statement w/$0 AF goes. I’m gonna try a charge above $1, then pay off everything but $1

Eliza
Eliza

I have a long relationship with BofA. For the first time this Feb they waived a balance of $1. http://imgur.com/xtIzzgT

Anthony
Anthony

If we do this with our cards, does it count as utilization? In other words, will this reset the clock of “inactivity” on our cards so they don’t get closed automatically?

anthonyjh21
anthonyjh21

I have the same question. Old thread I know, but I’d love feedback on this if anyone knows?

Elliot
Elliot

Discover hasn’t waived a 0.99 balance for me – not sure if they changed their policy or if I’m just unlucky!

Anthony
Anthony

I’d like to know if this changed!!! Any other data points?

Anthony
Anthony

Would this work for the old Discover miles card?

BenT

Thanks for this! I’m giving USAA a try this month…

whocares
whocares

I didn’t know Discover would waive $2. Will have to take advantage of that. I had assumed it was maybe up to 50 cents.

Mark Zhang
Mark Zhang

I tried $0.99 with BMO Harris credit card, and they did not waive it. It is now in my statement.

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