For everyone that owns a credit card, it is important to understand what the card member agreement says. This agreement is the 18 page detailed agreement that states what the credit card company can do to you. Unfortunately, it is more difficult to find a copy of these agreements through a search engine. These important agreements are sent to you after you sign the application agreeing to all of the terms and conditions that you haven't even seen yet. The card member agreement is sent to you along with your credit card. Most people ignore it.
There is a new provision showing up in these agreements that you need to know - first here is the legalize.
16. LIEN. You hereby appoint (credit card company) as your agent under a special power of attorney as well as give your express consent to enable us to charge against any balance in any of your accounts, including accounts on which you are a joint owner, to include any otherwise statutorily protected funds that may not otherwise be available by legal process, to pay any indebtedness or other outstanding financial obligation owed by you or any person who is listed as a joint owner on your accounts, including a deceased joint owner. This does not include your IRA or any other account for which this provision is not permitted. We may take such action without further notice to you or any joint owner. In regard to those funds that have a statutory protection, you understand that you may withdraw the special power of attorney and consent for (credit card company) to apply such funds to pay any such indebtedness by notifying us in writing. If your agency appointment or consent is withdrawn, (credit card company) may in its sole discretion terminate any and all services that you have with the (credit card company.)
You give them the right to deduct money from your bank or savings account if you are in trouble with your credit card. They can do it without any notice. It might not be such a good idea to have a credit card with the same company that you hold your bank account or that you are a joint owner on a bank account. For example, lets say you have a balance of $5000 on your credit card account. You are delinquent on the payment. You have a bank account with the same company that you have your Visa card. They can go into your bank account and take out the payment or the balance of $5000 from your bank account without notice. That probably is money that you were counting on to pay your mortgage and other important bills.
You can request that they remove this power of attorney from your account. If you do, they have the right to terminate all services and accounts that you have with the bank. Credit card companies are stepping up their game. With over trillion dollars of credit outstanding, they are taking all sorts of new steps to reduce their liability. As a consumer you need to know the rules of the game.