Rating the Credit-Card Guides


By Susan J. Marks The Internet can be a prime source for finding a better credit-card deal, but only if you're willing to invest lots of time to sort through and follow-up on the information. So how much can it save you, and what's the best way to lock in those savings?

I set off on my money-saving search with the help of two well-known interest rate resources on the Internet -- BankRate.com and CardWeb.com. BankRate is the granddaddy, started more than 25 years ago as the Bank Rate Monitor newsletter and has evolved into a Web site that regularly surveys about 4,800 financial institutions for rates on all kinds of banking products.

COMPETITIVE COMPARISONS. CardWeb is also an old-timer, established by Maryland-based RAM Research Group and spun off in 2000 but still controlled by the family that founded RAM. The site provides credit-card rate tables to publications such as USA Today and The Los Angeles Times.

I wish I could say that my card quest hit fast pay dirt. Instead, after spending some time on both sites, I was overwhelmed with information and confused by the differences among card listings that looked similar. My existing card, with its 10% rate, looked better than ever. But the competition in the credit card-market makes the sites useful if you use the right strategy.

Both sites provide answers to lots of questions about credit cards, have online calculators, and feature FAQs and newsletters. The information generally is free at BankRate, but some of it will cost you on CardWeb. Three of CardWeb's six newsletters are free, the others require subscriptions. Both sites boast surveys that present the latest credit-card rates from a wide range of banks.

ADS AND MINUSES. On BankRate, the route to rate details is more circuitous, usually requiring that the visitor wade through several pages of feature stories. BankRate also looks at mortgages, home-equity loans, auto loans, CD rates, and insurance, while CardWeb sticks to cards. BankRate also has extensive explanations and definitions of financial terms, and is loaded with plenty of advice, where CardWeb sticks closer to the data.

For example, if you're worried about how to improve your poor credit, Bank Rate has a few suggestions with its detailed "7 Steps to Fixing Your Credit Report." You also might want to check out "Credit Scoring 101" or "How to Get a Better Deal on Your Credit Cards." CardWeb doesn't have nearly as much ancillary content.

My biggest gripe with CardWeb is that it's very tough to tell advertiser-paid listings from those that aren't. It's a little easier to differentiate on BankRate, but both sites appear to mix paid advertising with editorial content. On CardWeb, clicking on "Find a Card," then selecting the "Low-rate card (APR under 14%)" brings up "CardTrak's Monthly Survey" of cards and rates. It leads off with 17 "Featured Cards."

LABELS NEEDED. I couldn't find an on-site explanation of why these cards are "Featured." So, I called CardWeb and learned that cash is changing hands -- either the outfits pay CardWeb an advertising fee or individual banks have performance-based agreements based on click-throughs, applications filed, or cards issued.

BankRate also slips in little ads here and there, and does so without much labeling. For example: In the Latest Rates box, below the numbers is "Find a Card" and an arrow with the word "Begin" next to a small MasterCard logo. What comes up seems like the BankRate site -- even though you have been redirected to MasterCard's site.

Both sites fall a little short in their basic task: Letting you compare credit cards. A CardWeb inquiry for "Low-rate cards" delivered a dizzying 10-page list but with too little data on any of the entries. It would take a phone call or a visit to a Web site (only the paid advertisers have links) to answer such important questions as: If a low rate is promotional, how long does the promotional rate last? Does it apply to new purchases or just balance transfers? What perks or incentives come with the card? Does the card, for example, provide automatic insurance coverage on rental cars? BankRate provided just 59 options. But even that list makes you do more work, while still leaving some of the same basic questions unanswered.

Both CardWeb and BankRate give you a lot of raw information if you're willing to sift through it. But the thing to do isn't to jump to the cheapest bank. The better approach is to briefly check out rates at BankRate and CardWeb, then go to your current card issuer and demand a better rate. (You can find some hints on how to do just that at BankRate.com) It saves time, frustration, and will likely net the same lower rate. That's my plan anyway. Marks writes on technology and personal finance from Denver


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