American Express offers two different types of accounts: credit cards and charge cards. The differences between the two are important to understand for several reasons. Unlike credit cards, which we all know about, charge cards must be paid in full monthly. That is, unless they don’t.
Over the years, AMEX has added the ability for cardholders to carry a balance on their charge card through its “Pay Over Time” feature. Once you sign up, any charge over $100 can be paid off over several months. Of course, you can still pay the entire bill if you want. AMEX has offered Membership Rewards bonuses for activating Pay Over Time, so you might have this feature on your charge card without remembering ever turning it on.
American Express more recently added another feature called “Plan It,” which allows you to take a single purchase and pay it off in a series of installments. This is more like taking out a loan than paying off a credit card.
What Cards Are Eligible for Pay Over Time?
The following cards are eligible for Pay Over Time:
- American Express® Green Card
- American Express® Gold Card
- The Platinum Card® from American Express
- Business Green Rewards Card from American Express
- American Express® Business Gold Card
- The Business Platinum Card® from American Express
Why Does It Matter?
Why should you care if the Pay Over Time feature is turned on for your AMEX card? Because it may keep you from being approved for a new AMEX card. Remember, AMEX has a limit of 5 credit cards per person, which is why we had to cancel a card before applying for a new one. There were reports a while ago on Miles To Memories where a new card application was denied for having too many open accounts. The interesting thing was the person involved didn’t have too many cards.
When calling the reconsideration line, he was told that the Pay Over Time feature was active on one of his charge cards and counted as an open line of credit, putting him over the limit.
I haven’t been able to find any recent data reports on whether AMEX counts cards with Pay Over Time activated like credit cards when applying for a new card. Whether this is still a rule or not, it makes sense for you to deactivate the Pay Over Time feature on your charge cards if you’re not using it.
How to Check If Your AMEX Charge Card Is Enrolled in Pay Over Time
Finding this setting on the website was difficult, so I typed Pay Over Time into the search box.
Here’s a link to the Pay Over Time page of the AMEX website. Once there, you can see if you’re currently enrolled.
If so, click on Inactive to turn off the Pay Over Time feature.
Final Thoughts
If you pay off your AMEX charge cards every month, it doesn’t matter if you have Pay Over Time activated. However, deactivating it may result in an offer to reactivate it later. That alone would be a reason to turn it off if you’re not using it.
I hoped we’d get clarity from AMEX if having it turned on impacts approvals for a new account. Without knowing, either way, I’d turn it off unless you have a really good reason not to.
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