First of all I should point out that there are actually two different airlines sharing the Virgin name.

• For flights within the US (i.e. Los Angeles to New York) then you are thinking of the Virgin America credit card. That airline operates flights only in the United States.
• For flights between the US and UK (i.e. Los Angeles to London or vice-versa) then you want the Virgin Atlantic credit card, which this review is about. All international flights are operated by Virgin Atlantic airlines.

It’s important to differentiate between the two because even though they both share the Virgin name, they’re independent from one another – totally different frequent flyer mile programs.

With that out of the way, let’s get down to business…

Round 1: Virgin Atlantic credit cards for US residents

The Bank of America Virgin Atlantic credit card comes in two tiers – white and black.

Both have the American Express logo on them, but it’s important to not these are NOT managed by AmEx. Bank of America is the manager and issuer. The American Express logo is on them because that’s the payment network used to process these credit cards.

Virgin America White Card

For a $49 annual fee, this card will net you 1 miles/dollar on regular spending and 3 miles/dollar on Virgin Atlantic purchases.

There’s an anniversary bonus each year too based on how much was spent. 2,500 bonus miles for $5,000 in annual spending, and another 5k miles for spending $15k or more (so the Virgin Atlantic White card can earn up to 7,500 bonus miles per year). For some reason this card is not shown on the BofA website.

Virgin Atlantic Black Card

Touting a $90 annual fee, it gives 1.5 miles/dollar on regular spending and the same 3 miles/dollar on Virgin Atlantic spending.

The anniversary bonus on the Virgin Black Card is a bit more tantalizing at up to 15,000 miles per year. It gives 7,500 miles for spending $15k annually. An additional 7,500 is awarded if spending reaches $25k or more. Cardholders can also earn 1 tier point per $2,500 spent each month (max of 2 tier points per month).

Regardless of which Virgin Atlantic American Express card you fancy, both of them have the following benefits:

• Might qualify to get 2nd reward ticket for half the miles: When at least $25,000 or more in purchases is made per year, one companion ticket will be given. It can only be used when you cash out miles for an Economy reward ticket. When you do so, the companion benefit will let you get a second ticket for half the number of miles as the first ticket. The credit card application on Virgin Atlantic’s site isn’t entirely clear but from what I can tell, you only get one companion perk per year (so spending $50k will NOT earn 2 of them).
• The basic AmEx benefits: Even though these cards are issued by Bank of America, they still come with the basic AmEx benefits since that’s who processes them. These include retail protection, extended warranty, and common carrier travel accident insurance.

Round 2: Virgin Atlantic credit cards for UK residents

These are issued/managed by MBNA Europe Bank. Like the US counterparts, these credit cards also come in a white and black level. You have the choice of Visa or American Express for each.

White Card (Visa)
This comes with a $0 annual fee but with the free price tag comes lower rewards: 1 mile per £2 spent normally and spending with Virgin Atlantic it’s 1 miles per £1.

White Card (American Express)
Same as the above except the AmEx version gives double the rewards: 1 mile per £1 normally and 2 miles per £1 on Virgin Atlantic.

Both of the white give you:

• premium economy reward upgrade for spending £10,000+ per year (limit 2 per year)
• free companion reward flight for spending £15,000+ per year (1 per year)

Black Card (Visa)
For a £140 annual fee you get 1 mile per £1. For purchases on Virgin it’s 2 miles per £1.

Black Card (American Express)
Same fee as above but double the rewards: 2 miles per £2 on regular purchases and 4 miles per £1 when buying from the airline.

Both of the black give you:

• premium economy reward upgrade for spending £5,000+ per year (limit 2 per year)
• free companion reward flight for spending £7,500+ per year (1 per year)

Round 3: How Much Are Virgin Atlantic Miles Worth?

The White Virgin Atlantic credit cards might be lackluster, but the black cards definitely pack some mileage power (on both sides of the pond). But how much are these miles truly worth?

Both the UK and USA Virgin Atlantic credit cards offer Flying Club miles… so the number of miles required for a flight will be the same for both US and UK credit cards.

For flights from the US to UK (and vice-versa) here’s the number of points it will cost you for a roundtrip flight between the following destinations:

The economy flights are slightly cheaper than the other guys (British Airways and many others charge 50,000 miles). However the Virgin Atlantic Flying Club has a major drawback, especially for those in the US…

The problem is outrageous redemption fees and taxes

You might have to pay up to $500-800 in taxes, fees, and fuel surcharges for reward flights. This is the achilles heel of the Virgin Atlantic Flying Club miles.

Winner or Loser?

There’s no denying Virgin is one of the best airlines on the planet. However, their award redemption fees are among the worst. For this reason, I’m not a fan of the Virgin Atlantic American Express cards for US residents. But for those in the UK, the black version is one of the best credit cards you can get since it gives 2 miles per £1.

Here in the US it might make more sense to get the Venture card from Capital One and use the double miles it gives to buy flights on your own (each mile = $0.01 value towards travel).

Why buy tickets instead? Because with Virgin Atlantic the actual airfare is sometimes the cheapest part of the purchase.

So to redeem 47,500 Flying Club miles (from a Virgin Atlantic card) on the above route from Los Angeles to London would be silly, considering there are still taxes and fees to pay. It just doesn’t make sense.

Paying a 3% surcharge when using your credit card internationally? Well that sucks. Here’s how can pay no foreign transaction fees in 2012.

Credit card companies charge a 2% to 3% fee because they claim it’s necessary to help cover the costs of the currency conversion. That excuse is a crock! The currency conversion takes place within 24 hours, so it is highly unlike they would lose (or gain) 2-3% percent during the process. This fee is obviously a big money maker for them.

Fortunately, there are a few ways you can reduce – or even eliminate credit card foreign transaction fees:

Best cards with no foreign transaction fee?

#1 – Chase Sapphire Preferred

Without a doubt this is one of the best credit cards to have for traveling. You earn an unlimited 2x points on travel, 2x points on dining, and 1x on everything else. You can redeem your points for almost anything (including cash back) however the best way to use them is for air/hotel because Chase gives you 25% more value that way. For example 10,000 points = $100 cash back – or – $125 towards air/hotel. Oh and that foreign transaction fee? It’s a big zero! Go here to read the full review.

#2 – Capital One Venture Rewards

Out of all the major players in the credit card world, Capital One is the only issuer that hasn’t succumbed to charging foreign transaction fees. It seems like something too good to be true… but it’s not. This of course makes them a top choice for international usage. And without a doubt their best cards for travel are the Venture (avail in 2 versions).  Go here to compare the Venture cards side by side.

#3 – Citi ThankYou Premier

The card was launched a little over a year ago and packs a lot of benefits. It does have a drawback in that it is more expensive than the others above; the ThankYou Premier is $125 per year. However this is one of my favorite no foreign transaction fee credit cards because of the “Flight Points” program – you earn 1 point per mile flown. So let’s say you flew from Los Angeles to London. By my calculations that’s around 5,400 miles one way (so let’s say 10,800 roundtrip). With this card you would earn 10,800 points for that flight. See my full review of the card here.

#4 – American Express Platinum

If you want a high-end travel credit card with no foreign transaction fees, then AmEx Platinum is in a class of its own. If you don’t travel much, it won’t be worth it because of the $450 membership fee. However you may be surprised to learn that for even the occasional traveler, the value of the benefits can trump the fee many times over. For example, you get over $450 worth of benefits every time you stay at 700+ high-end hotels across the globe (get free room upgrades, food/drink/spa credits, etc). This is why its a favorite not only for foreign travel, but also domestic. Simply put, you won’t get these perks with any other card. Here is my detailed review of the American Express Platinum.

#5 – Marriot Rewards Premier

Back in 2011 Chase and Marriott decided to improve the credit card program and now, it’s one of the best out there if you regularly or occasionally stay at Marriott properties. With it you get 5x points at Marriott, 2x points on airlines, restaurants, and car rentals, and 1x elsewhere. There are quite a few benefits including the no foreign transaction fee. To view the review and bonus offer go here.

Honorable Mention – Discover Cards

Last year Discover decided to drop the foreign transaction fee on all of their credit cards. The only reason I’m leaving their cards out of the top 5 list is because their international acceptance is poor in most regions. However they’re an excellent (actually, the best) choice for the following countries:

• China: Because they’re accepted everywhere China UnionPay is, Discover is actually the most widely accepted credit card in China.
• Japan: Can be used anywhere that takes JCB (which is the largest card network in Japan)
• South Korea: Use anywhere that takes BC card (South Korea’s largest card network)

Even though Diners Club is now a dud in the United States, they’re still quite popular in some South American and European countries. Since Discover bought their int’l payment network 4 years ago, you can now use your Discover card at any foreign merchant that accepts Diners Club.

The best travel cards from Discover are the Escape ($59 annual fee, 2% rewards) and the Miles (zero annual fee, 1-2% rewards).

Cards with lowest foreign transaction fees? (that aren’t zero)

Most credit cards charge 2-3% for this fee. But just to give you an idea of how they compare, here’s a list – ranging from the highest to lowest – of what each issuer normally charges for the majority of their cards (obviously the above 5 cards are exemptions):

3.0% fee for Bank of America Visa & MasterCards (their AmEx versions charge 1%), Citi, Chase, HSBC, US Bank, Wells Fargo, Fifth-Third Bank, Barclaycard.

2.7% fee for all American Express cards (excluding the Platinum)

2.0% fee for Comerica, PenFed Credit Union (excluding their Promise card, which charges zero)

1.0% fee for USAA, Navy Federal

I guess it’s a stretch to label the 2% and 2.7% as “low” fees, but they are lower than the vast majority of cards, so they’re at least worth mentioning in case you don’t plan on applying for a new credit card right now and want to continue using the least painful option that’s currently in your wallet.

We all know there are plenty of bad credit card deals out there for those with bad credit. However the Aventium Classic credit card stoops to an all-time low…

Okay… so your credit sucks and you want to rebuild it. You search far and wide on some credit card websites and see them pushing the First Premier Bank Aventium MasterCard as their top choice for bad credit.

Is this credit card really the numero uno? Or is the reason for it being number one because it’s a huge money maker for the website advertising it? Review the card and decide for yourself.

How it works…

For 2012 here’s a look at the fees and rates…

• When you apply for Aventium’s credit card you have to pony up a $95.00 security deposit. In exchange for that, you only get a $300 credit limit.
• You first year’s annual fee is $75.00. Yes, that’s the equivalent of 25% of your entire credit limit!
• For the second year and beyond, your annual fee drops down to $45.00. However starting on the second year, they also add a $6.50 “monthly servicing fee” to your account. Multiply that by twelve and add in the $45.00 annual fee… it’s costing you $123 annually for the 2nd year and beyond.
• If you ever end up carrying a balance, watch out! The Aventium credit card’s interest rate is an outrageous 49.9%. That’s about 20% higher than what even the worst store credit cards will charge you!

*Sidenote: You would think the “servicing fee” would help fund good customer service, right? Well according to a number of Aventium credit card reviews I have read online, their customer service is downright awful.

Aventium vs. competitors?

Simply put, the Aventium credit card is a horrendous deal no matter how you slice it.

Even if you have bad credit, you can apply for secured credit cards that have less fees (as low as a $29 annual fee) and the security deposit amount can be as little as $200. Remember security deposits – whether on the Aventium or another card – will be fully refundable when you close out your account.

So let’s see… paying something like $29 or $35 per year for a secured card from another issuer? Or paying $75 to $123 per year for the Aventium Classic MasterCard? Take your pick.

Why is Aventium being so ridiculous?

That brings us to the question… why is Aventium being so greedy with their credit cards? And how are they getting away with this?

When the Credit CARD Act (the reform) was passed, it capped the amount of fees a card issuer can charge during the first year; no more than 25% of the card’s credit limit.

Before the reform, First Premier Bank actually had cards with fee which were more than 25% if you can believe it. But to be in compliance with the law, they set the Aventium card’s annual fee at $300 for the first year, which is exactly 25% of the credit limit.

However as discussed above, on year two they start charging a $6.50 “monthly servicing fee” which places the total fees per year at $123… that’s 41% of the credit limit! But that’s 100% legal because the Credit Card ACT only regulates the fees during the first year and not after. I presume that’s why the Aventium fees are structured this way.

As to why they’re being so greedy… that I cannot answer. Obviously not everyone is going to fall for this trick. However there is plenty of demand out there for bad credit credit cards, so as long as there are people gullible enough and/or who don’t read the application before applying, my guess is this card will stay on the market.

Conclusion? The Aventium Classic is nothing but a classic horror story.

Platinum, Premier, Preferred, Prestige… and now Privileges (as if we didn’t need another “P” credit card in this world). The past few times I’ve logged into my Bank of America account they’ve been trying to peddle me their new BankAmericard Privileges credit card.

This card isn’t mentioned anywhere in the credit card section on the BofA website. Apparently it’s a more targeted offer geared towards those who keep $50k or more at BofA and/or Merrill Lynch (their subsidiary).

When I clicked on the credit card offer not much info wasn’t given, so for the purpose of writing this review I called customer service…

The “Privilege” of Philippines Customer Service?

If the Privileges Visa Signature is a semi-premium card, the least I would expect is U.S. based call centers. After all, if the no annual fee Sapphire and More can offer prompt customer support, then shouldn’t the Privileges card, too?

Apparently not.

Upon calling the phone number listed on the BankAmericard Privileges promotion page (and after pressing many buttons) I was greeted by a woman in the Philippines. She wasn’t very helpful so I asked to be transferred to a U.S. call center, which she did.

While the U.S. support rep was nice, unfortunately he didn’t have much additional info, other than what I could see on the page for this credit card deal.

The Pros & Cons

PRO – Earn “up to” a 1.5% rebate on regular purchases

When points are redeemed for cash back which is directly deposited to your BofA or Merrill Lynch account, you get 50% more cash. Yes, sounds kind of similar to the Capital One Cash Rewards commercials, right?

CON – It uses the WorldPoints program

My biggest complaint is that the Privileges credit card uses WorldPoints. With these, you normally need to save up an awful lot to get full value – 25,000 points for the 1.0 cent redemption. It’s unclear whether this card’s minimum amount to get full point value is the same or not.

PRO – Bonus point categories

You do have the opportunity to earn more than 1x points through the BankAmericard Privileges categories which rotate each quarter. The most frustrating part however is that there is no way to know what categories you will get! Unlike the BankAmericard Cash Rewards which gives all cardholders the same 3x points categories, with the Privileges it will differ.

My promotion for the first 3 months was for gas, grocery, drugstores, restaurant, and travel. But the customer service rep I spoke with (a) couldn’t tell me what categories would come after that, and (b) couldn’t tell me what the possibilities are, because the offers are “decided by the marketing department” and vary by customer.

CON: Annual Fee

You will have to cough up a $75 annual fee for this credit card if you don’t maintain a minimum balance of $50k in your BofA/Merrill deposit accounts.

PRO: Signup Promotion

My offer was for 10,000 bonus points which according to the “50% more” tagline, would equal up to $150 cash back.

CON: Benefits are okay/average

This is a Visa Signature card, so you do get a few bells and whistles like purchase security and an extended warranty benefit. These are good for a no annual fee card but if you end up paying $75/year I would come to expect more, wouldn’t you? It’s disappointing to see that they do not waive foreign transaction fees (which the competing Chase Sapphire Preferred and Citi ThankYou Premier both do).

Verdict?

I think the Bank of America Privileges card does have a lot of potential, but I am going to wait until it’s been out a while (probably the end of 2012) until I give my verdict. Because as it stands today, BofA is not being transparent enough with the 3x point categories.

I want to see what the future categories will be and whether or not there is a cap on the 3x points. Yes, I did ask customer service, but he started reading from a script about how there are no limits to the number of points you can earn. Does that just reference regular spending, or also the bonus categories? Without knowing these things for sure, I am holding off on my recommendation.

AnnualCreditReport.com is the only website for free credit reports that is mandated and authorized by the federal government. But it’s still a bit sketchy…

In 2003 President Bush signed into law the Fair and Accurate Credit Transaction Act. One of its provisions required each of the 3 major credit bureaus (Experian, Equifax, and TransUnion) to provide consumers free access to their credit reports every 12 months.

This gave birth to the AnnualCreditReport.com website, which contrary to popular belief, is not a government ran site. Rather, it is operated by Central Source LLC, which is a joint venture created by the three credit reporting agencies.

Perhaps Central Source LLC needs to take a good hard look at the complaints I am hearing from consumers, because many feel the Annual Credit Report website is a bit scammy, in some regards.

Complaint #1: Misleading Name

First and foremost, let’s talk about the name.

We all remember that imposter website, FreeCreditReport.com, which took a lot of criticism for its similar sounding name (sidenote: they now focus on their other site, FreeCreditScore.com instead). But in all fairness, it’s not like AnnualCreditReport.com has the best name either.

Why? Because with the word “annual” in there, many people assume that means once per year. They think it means they can check their credit report from each of the 3 bureaus once per calendar year (example: Check Equifax once in 2012, once in 2013, and so forth).

Unfortunately, that’s not how it actually works. Rather than going by calendar year, it goes by every 12 months.

When the end of the calendar year rolls around – like Oct, Nov, and Dec – I regularly hear from consumers who rush to check all 3 credit reports, thinking the clock will reset on January 1st. It’s not ‘til the following year when they discover they will have to wait 12 full months after checking before they can do it again. If they would have known that, they wouldn’t have checked all 3 at the same time.

Embarrassing fact? At one point I even believed this was how it worked and made that same mistake.

Complaint #2: Misleading Credit Score Ads

When using the Annual Credit Report website you will be bombarded with paid ads; some clearly identified as such, others not so much.

The TransUnion report is the one I hear the most complaints about, the one that most people allege feels like a scam. Here’s why…

The “I want my free credit score” is an advertisement and so is the Score tab which is next to the Report tab at the top.

Click and you will be taken to this page…

It’s not ‘til after you click the “FREE SCORE” button above where you are taken to a page which fully explains that you are actually enrolling in a 7-day trial. Yeah, technically it is free but if you don’t cancel, you will be automatically billed at the regular price (which was $14.95 per month last I checked).

Now in all honesty, I actually don’t have a problem with these types of “free” trial offers. I don’t think they are a scam as long the terms are clearly and prominently identified (in order words, if the consumer truly knows what they’re signing up for).

But when you look at the way TransUnion is peddling this, in my opinion it is done in a less transparent manner than some other websites. Even the highly criticized “free” trial websites of FreeCreditScore.com/FreeCreditReport.com seem to be more upfront.

So talk about irony… everyone promotes AnnualCreditReport.com like it’s the best thing since sliced bread, as if it can do no wrong. But in actuality, it *might* mislead a consumer just like the other sites do. Think about it… would your grandma be confused by that bright red “I want my FREE Credit Score!” link? I know mine would, especially if she erroneously believed she was on a government website.

Complaint #3: Website Not Working

I have heard people allege that there is some sort of AnnualCreditReport.com scam going on when they can’t access the website. Their theory is that it’s allegedly used as a trick, to deter them from the free report and instead, go to credit bureau’s website directly and buy a report.

Coincidentally, while writing this review I actually encountered Experian not being available (pictured left).

But does this make AnnualCreditReport.com a scam? Definitely not. That conspiracy theory is nonsense.

When a bureau is unavailable like this, it’s probably due to routine site maintenance or some other temporary issue. If that happens, just check back later and it should be working. For me, that message was gone 20 minutes later.

Conclusion? This is frustrating to encounter but don’t worry, this is NOT a scam. Just be patient and return a bit later.

Complaint #4: Can’t Confirm Your ID

A couple times when I’ve used the AnnualCreditReport.com website, I wasn’t able to pull all my reports. A message would be spit back saying they can’t confirm my identity and to get the report through this site, I would have to jump through hoops to validate my ID. If I recall correctly, it involved mailing in proof.

On the forum I have seen people say there is a scam going on when this happens. Well guess what? It’s not a scam or trick. The truth is that they really do have to validate you’re the real deal before handing over your personal report. So these complaints are 100% baseless in my opinion.

Complaint #5: Peddling Identity Theft Protection

Thanks to all those TV commercials for LifeLock and Identity Guard, the business of selling monthly ID protection subscriptions seems to be hotter than ever (but it’s debatable whether they’re justified).

So I guess it comes as no surprise that over the last few years, now we not only have to endure ads for credit scores, but also ID monitoring. But fortunately, thus far I haven’t seen any which are confusing like some of the credit score ads are.

But at the end of the day…

…this is still by far the best site to get your credit reports for free. Despite the complaints, AnnualCreditReport.com is NOT a scam.

Sure, the quality of AnnualCreditReport.com is going down as the numbers of ads go up, but it’s still the only legit place you can get a truly free report without having to enroll in some trial offer… as long as you don’t do so accidentally!