Is it legal for a credit card company to charge you fees before you've even activated your card?

Question

I opened a credit card account and somehow missed the small print, where they said there was a $39.00 activation fee and a $60 annual fee. I realized my mistake when they sent me my card, so I didn't activate it, hoping I could close the account before using the card, and thus avoid the fees. But they charged me the fees anyway - now I owe $100, and I haven't used the card once! Is that legal?

Thanks for your advice, everyone!
I just called the company - Credit One - and they closed the account for me and removed the charges. They were really nice about it, too, no questions asked. I really lucked out.

But what you said about having closed accounts on my credit report is a little worrying, Marcelis G - I'm not sure if the account is considered "closed" or just "cancelled". Oh well, at least I don't have to pay 100 bucks! :)

Answer 1

Yes it is legal. When you don't actively cancel the card they automatically (and legally) presume you accept the terms and can charge the fees.

If you still have not activated the card and it was just recently sent to you, you might contact them and tell them you want to cancel the card and for them to reverse the fees.
Take notes when you call. Write down the time and date you called and who it was you spoke with.

If they agree to reverse the fees, be sure to send them a follow-up letter confirming the cancellation and fee reversal. Include the infomation you wrote down - who you spoke with etc.

edit+++++
congrat's on having no problems in getting the card closed and the fees reversed.
Be sure to send the follow-up closure letter.

As far as it showing up on your credit report, if it does it should show as closed by consumer - which will not hurt you.

Answer 2

Since you did not activate the card they can not legally
charge you because they can not prove that you have
received the card.

ie the Contract has not fully been consumated

My suggestion is to call the credit card company
tell them that you still have not received the card and
you think that it either lost or possibly stolen, then ask
if there ANY charges on the card when the tell you
that there is ask them to remove the charges and
cancel the card because you can not be held responsible
for a card that you have never received and when they
tell you that they will send you a new card tell them
no thank you I will apply again later after I have time
to investigate on my own and you don't want another
card out there that may get stolen.

I know that this STINKS of being dishonest but charging
you before you even activate the card is as well, think
about it if the card sat for a couple of weeks and
later you discovered you owed money they can and
would charge you late fees on money that you do not
owe until an acknowledgment is made, the reason
for validataing a card simple.

First you have to do it from your HOME phone, this
is proof of delivery and then you are stuck with a $100
lesson that you will not soon forget

Answer 3

You have so many day's to call and/or write to cancel your account for card companies that have activation and/or annual fees. (U.S. Law) If you read further in the fine print, it should tell you how to close the account and get your bank back to your account. I hope you ask for a letter stating that you will not be charged. It may or may not affect your credit score. Most likely this card will not be reported because you canceled the card.

Answer 4

sorry to inform you that if you signed the contract that you agreed to those terms. thats why it is always good to read the fee section at least because i know the terms and conditions that are listed are pretty lengthy. in your situation you may be able to get out of this one because you have not used the card yet how ever it may be listed as a closed account on your credit report which in some cases is bad. you should call the credit card company and ask if it can be cancelled and would it be reported to the credit bureaus. i would defly call and find out before using it.

Answer 5

Yes. It is in your terms and conditions which was probably in small print and you didnt read about it before you signed or applied. So legally, they can because you agreed to it.

Some credit card companies do charge the annual fee upfront and some have activation fees.

However, if you are not interested in the card, call them and request a refund and that they close the account.

You need to put them on blast when you call and tell them that you were not aware or notified properly. Make sure that you talk to a manager so they know your not kidding.

There are many credit card companies that do not charge such fees. Make them aware that you would rather do business with those companies.

Calling them is no different than writing them. All calls are recorded and noted.

Answer 6

How long did you keep the card? If you cut it up and send it back to them. YOU DON'T OWE THEM A CENT!!
If they try to charge you, seek professional legal assistance. $39 was for activation, but you didn't activate it! So what gives. You can also write a strongly worded letter to the company. Put it in writing. It means more than phoning them.

Answer 7

Tough lesson to learn the hard way, but you are responsible for reading all the terms before signing. A defense of not reading it because it was in the small print is not valid. Remember, the smaller the print, the more likely it contains something they don't want you to know.

Answer 8

You signed the paper work. This is why you should ALWAYS read the fine print. If they had asked for your first born to open an account, you would still be held responsible for it in a court of law.

In the future, READ the fine print of ANY contract first.

Answer 9

Yes you are LEGALLY OBLIGATED to pay all fees that you signed 4. Some credit card companies have these very same fees that you're complaining about and STILL ARE GOOD COMPANIES.

So pay the fees and reexamine whether this is a good company or not and make your ACTION DECISION from there

p.s. YOU CAN'T GET THERE FROM HERE ! ! ! !