By Liz Morris

Wachovia announced this week that it has achieved one million new credit card customers since relaunching its credit card business last summer. The one millionth customer got 250,000 Wachovia Possibilities Reward points, while the first 999,999 cardholders got no special treatment whatsoever.

If one million cardholders does not seem like an outrageously high number, it becomes more impressive when considering that Wachovia has mainly focused on marketing its cards to existing customers, versus the common practice of many card issuers in which consumers are inundated with mail offers.

Wachovia had previously been issuing credit cards through a joint marketing agreement with MBNA, but terminated that agreement in November 2005 shortly after the announcement that Bank of America would acquire MBNA. Wachovia re-entered the credit card business in July of 2006.

By Liz Morris

Following on the May 23rd announcement that partner lenders would now be accepting its credit cards for mortgage payments, American Express has added IndyMac Bank as its second partner in the endeavor. IndyMac Bank, the second-largest independent mortgage lender, will start accepting American Express this summer for those taking out new mortgages or refinances, and who enroll in the Express Rewards Mortgage program, which requires a $395 fee as part of the mortgage closing costs. American Home Mortgage was the first partner announced as part of the new program.

Click here for our previous coverage giving more detail on the Express Rewards program.

By Liz Morris

Women’s clothing retailer Cache has launched the Cache Visa, which is offering five points for every dollar spent at Cache and Cache Luxe stores or at cache.com and one point per dollar on purchases elsewhere. Cache Visa cardholders will receive a $25 Cache gift card each time a total of 2,500 points is accumuluated. New cardholders alse get a bonus 1,000 points after their first purchase with the card. The Cache Visa is being issued in partnership with US Bank.

Cache, Inc., which describes itself as offering “sophisticated, social-occasion sportswear and dresses targeting a woman who has a youthful attitude, is self-confident and fashion-conscious, and requires a missy fit,” operates 294 Cache and Cache Luxe mall stores.

Potential Cache Visa cardholders can apply for the credit card at www.cachevisa.com.

By Liz Morris

American Express announced a new program today that would allow mortgage payments to be charged to its credit cards for the first time.  The program will begin with just a single mortgage lender partner, American Home Mortgage, but should spread to additional partners in the future.

The Express Rewards Mortgage program, as it is known, will be open to good credit customers opening a new mortgage or refinancing an existing mortgage. While the program will thus allow American Express cardholders to earn Membership Rewards points on their mortgage payments, the attraction may be blunted somewhat by the fact that a $395 fee is required to join the program. A mortgage holder paying $1,000 in mortgage payments might need three years to break even given the initial fee.

American Express has previously made its mark in the housing payments arena by allowing rent payments and condo down payments to be charged in limited areas, usually within the luxury segment of the real estate market.

By Justin McHenry

Government officials continue to turn up the heat on credit card companies.  After being dragged in front of multiple Congressional hearings and seeing a new bill introduced that would force a plethora of changes to the way they do business, credit card companies today got a kick from the Federal Reserve, which proposed changes to the rate and fee  disclosures that card companies provide consumers.

The Fed conducted a number of surveys and focus groups in the recent past, and came up with a list of suggestions that the Board feels would help consumers better understand card terms, as well as give them the opportunity to compare cards more intelligently. Among those suggestions:

• Credit card companies would have to give 45 days notice when making changes to credit card terms, compared to the current 15 days.
• When card terms are changed, card companies would send out notices that clearly spell out what has been changed from the original agreement, versus the common practice today of simply sending out a new document spelling out all the terms and conditions of the card.
• Changes to card terms would be included on the monthly bill itself, versus a separate insert that is often ignored by consumers today.
• Disallow describing cards as “fixed rate” unless a specific time frame is spelled out. Today cards can be called fixed rate but card companies can change the rate with the 15 days notice mentioned above.
• Change disclosure language concerning the rate cardholders would pay if they are late with payments, go over their card limits, or other behaviors that trigger a higher rate.  Today this higher rate (which is often over 30%) is called the “default APR.” This would be changed to the “penalty APR.”
• Redesign the “Schumer box,” the large grid-like box that currently shows information such as interest rate, annual fee, days in a billing cycle, etc. to include more information on fees and penalty interest rates, information that today is often described below this box.

All of these changes are proposed amendments to Regulation Z, which came about with the Truth in Lending Act of 1968. The Federal Reserve Board is looking for public comment on the proposed changes, allowing at least 120 days for that process.  When final decisions could be expected was not announced, but given the comment period, it would be fall of this year at the earliest.

By Justin McHenry

In the increasingly heated competition to offer the most unique credit card rewards, Citi has added art from renowned pop artist Peter Max to its ThankYou rewards program. Get a signed Peter Max poster for a little over 30,000, a signed limited edition lithograph for 80,000+ points, or even have Peter Max paint your portrait—that is, if you have at least three million points banked and ready to be redeemed.

A total of 18 artworks by Max, spanning his many decades of work, are available in the various formats described above. Max says he is “very pleased to make my artwork accessible to people who previously weren’t able to purchase one of my pieces.”

By Seth Harbison

If you’d like to pimp your backyard with the latest outdoor goodness, you’ll want to use your MasterCard at Home Depot between now and June 23rd. MasterCard and Home Depot have teamed up on the $100,000 Backyard Retreat Sweepstakes, which will give one winner $100,000 to spend on his/her backyard, courtesy of Home Depot.

What would this dream backyard look like? According to a press release, it might include “flowing water fountains, a beautiful gazebo and outdoor furniture, as well as a luxurious outdoor kitchen complete with a state-of-the-art grill.”

MasterCard holders in the U.S. will be automatically entered every time they use their MasterCards at The Home Depot from now until June 23, 2007. Use The Home Depot Rewards MasterCard or The Home Depot Business Rewards MasterCard card for your purchases, and you’ll get two entries each time.

By Justin McHenry

A bill introduced this week in Congress is attempting to legislate what credit card companies can and can’t do when it comes to the rates and fees they charge their customers.

Democratic Senators Carl Levin of Michigan and Claire McCaskill of Missouri are targeting a number of practices that lawmakers have said confuse consumers or are unduly harsh.  Among the mandates the proposed law would include:

• Interest rate hikes due to late payments could not rise more than 7 percentage points above the current rate.
• Require interest rate increases to apply only to debt incurred after the rate hike, not to existing balances charged when rates were lower.
• Require payments to apply to the portion of the balance with the highest interest rate.
• Ban  “universal default,” the practice of hiking interest rates on a customer who is late on a bill unrelated to the credit card.

Several credit card issuers have introduced more customer-friendly policies recently, perhaps with the hope of keeping Congress from more closely regulating the industry. Chase recently ended its practice of two-cycle billing, which had allowed them to charge interest on a previous month’s balance, even if most of it had been paid off. Citi ended its policy that gave it the right to hike rates at any time for any reason, saying it would only do so for habitual late payers or when cards were up for renewal.

By Seth Harbison

Blizzard Entertainment, the company behind the hugely popular online multiplayer role-playing game World of Warcraft, has announced a new World of Warcraft Visa that rewards cardholders with free game time. Each dollar charged on the card is worth a point, and every 1500 points accumulated gives the cardholder one free month of play on World of Warcraft. New cardholders will also get a free month of the game immediately upon their first use of the Visa.

Thirteen variations of the World of Warcraft card design are available, including designs for all ten playable character races, as well as for the Horde and Alliance factions and the World of Warcraft logo. The card is being issued by First National Bank of Omaha.

Interested cardholders can click this link for the World of Warcraft Visa.

By Justin McHenry

The Costco True Earnings Business Card from American Express has added an attractive new reward—a 5% rebate on gas purchases. This new rebate is not a replacement but instead an addition to the rebates already offered by the card, which include a 3% rebate on restaurant purchases, a 2% rebate on travel purchases, and a 1% rebate anywhere else.

The 5% gas rebate would be good for gas purchases at Costco or stand alone gas stations, but not gas stations connected with wholesale clubs, discount stores or supermarkets.

This new gas rebate applies only to the Costco True Earnings business credit card, not the Costco consumer card.