Reply
Valued Contributor
Posts: 2,952
Registered: ‎06-05-2013
0

Freedom foreign transaction fee

One of the few downsides of my Freedom card is the foreign transaction fee. I have been told that if I buy something online from another country where the price is charged in a foreign currency that I will also be hit with this fee. I just want to confirm if my understanding is correct?


Starting Score: EQ: 714, TU 684
Current Score: EQ: 725 7/30/13, TU 684 6/2013, Exp 730 6/27/14, Last App 1/3/15
Goal Score: 800 In garden until 4/2015
Super Contributor
Posts: 7,132
Registered: ‎02-27-2013
0

Re: Freedom foreign transaction fee


red259 wrote:

One of the few downsides of my Freedom card is the foreign transaction fee. I have been told that if I buy something online from another country where the price is charged in a foreign currency that I will also be hit with this fee. I just want to confirm if my understanding is correct?


Depends on where that merchant is based.

If they are using a foreign payment processor, the TFT will apply.

If they are charging you in foreign currency, they're most likely using a foreign payment processor.

 

I am not too sure how foreign currency payments made out via paypal counts though. you would be charged a conversion fee (if any), but I am not sure about the FTF.

 

JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Valued Contributor
Posts: 2,952
Registered: ‎06-05-2013
0

Re: Freedom foreign transaction fee


enharu wrote:

red259 wrote:

One of the few downsides of my Freedom card is the foreign transaction fee. I have been told that if I buy something online from another country where the price is charged in a foreign currency that I will also be hit with this fee. I just want to confirm if my understanding is correct?


Depends on where that merchant is based.

If they are using a foreign payment processor, the TFT will apply.

If they are charging you in foreign currency, they're most likely using a foreign payment processor.

 

I am not too sure how foreign currency payments made out via paypal counts though. you would be charged a conversion fee (if any), but I am not sure about the FTF.

 


Could you still be hit with it even if your being charged in USD? 


Starting Score: EQ: 714, TU 684
Current Score: EQ: 725 7/30/13, TU 684 6/2013, Exp 730 6/27/14, Last App 1/3/15
Goal Score: 800 In garden until 4/2015
Super Contributor
Posts: 7,132
Registered: ‎02-27-2013
0

Re: Freedom foreign transaction fee


red259 wrote:

enharu wrote:

red259 wrote:

One of the few downsides of my Freedom card is the foreign transaction fee. I have been told that if I buy something online from another country where the price is charged in a foreign currency that I will also be hit with this fee. I just want to confirm if my understanding is correct?


Depends on where that merchant is based.

If they are using a foreign payment processor, the TFT will apply.

If they are charging you in foreign currency, they're most likely using a foreign payment processor.

 

I am not too sure how foreign currency payments made out via paypal counts though. you would be charged a conversion fee (if any), but I am not sure about the FTF.

 


Could you still be hit with it even if your being charged in USD? 


if the payment processor is overseas, you should still be charged the FTF.

Many countries use the USD as their currency, or at least their prefered currency of payment, but they're not part of the USA. 

JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Valued Contributor
Posts: 7,075
Registered: ‎10-21-2012
0

Re: Freedom foreign transaction fee


enharu wrote:

red259 wrote:

enharu wrote:

red259 wrote:

One of the few downsides of my Freedom card is the foreign transaction fee. I have been told that if I buy something online from another country where the price is charged in a foreign currency that I will also be hit with this fee. I just want to confirm if my understanding is correct?


Depends on where that merchant is based.

If they are using a foreign payment processor, the TFT will apply.

If they are charging you in foreign currency, they're most likely using a foreign payment processor.

 

I am not too sure how foreign currency payments made out via paypal counts though. you would be charged a conversion fee (if any), but I am not sure about the FTF.

 


Could you still be hit with it even if your being charged in USD? 


if the payment processor is overseas, you should still be charged the FTF.

Many countries use the USD as their currency, or at least their prefered currency of payment, but they're not part of the USA


+1

 

As enharu mentioned, this all boils down to functional currency vs transaction currency.

Super Contributor
Posts: 9,185
Registered: ‎04-22-2013
0

Re: Freedom foreign transaction fee

And, when abroad, look out for dynamic currency conversion, where a helpful local merchant bills you in USD ("for your convenience")  Many of those who know about FTF assume that this will avoid them, but it doesn't.   It's a really bad idea as you often get a poor exchange rate from the merchant (much worse than Visa/MC/Amex) and get the FTF fee anyway.

Valued Contributor
Posts: 2,952
Registered: ‎06-05-2013
0

Re: Freedom foreign transaction fee


longtimelurker wrote:

And, when abroad, look out for dynamic currency conversion, where a helpful local merchant bills you in USD ("for your convenience")  Many of those who know about FTF assume that this will avoid them, but it doesn't.   It's a really bad idea as you often get a poor exchange rate from the merchant (much worse than Visa/MC/Amex) and get the FTF fee anyway.


I make it a habit to avoid paying in US currency when outside the country. 


Starting Score: EQ: 714, TU 684
Current Score: EQ: 725 7/30/13, TU 684 6/2013, Exp 730 6/27/14, Last App 1/3/15
Goal Score: 800 In garden until 4/2015
Super Contributor
Posts: 7,132
Registered: ‎02-27-2013
0

Re: Freedom foreign transaction fee

I'm interested to find out if FTF is charged when the payment is made via PayPal but in foreign currency though. Happens sometimes on eBay when the seller is in Asia. However I haven't bought anything on eBay for quite a while now, so I can't remember.

Does paypal convert to USD on their own, or do they bill in foreign currency?
JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Frequent Contributor
Posts: 498
Registered: ‎02-08-2013
0

Re: Freedom foreign transaction fee


enharu wrote:
I'm interested to find out if FTF is charged when the payment is made via PayPal but in foreign currency though. Happens sometimes on eBay when the seller is in Asia. However I haven't bought anything on eBay for quite a while now, so I can't remember.

Does paypal convert to USD on their own, or do they bill in foreign currency?

When I buy on eBay (from Hong Kong), the prices are already converted. i.e. It'll list something like "77.99 HKD (equivelent to $10.05 USD)". When charged, it only charges me the amount that is equivelent to USD - so $10.05 exactly. So no FTFs.

 

This is only eBay though, I don't know about other sites using PayPal.

     

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions based on Experian or Equifax data (additional FICO® Score versions based on TransUnion data are not currently available on myFICO.com). Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.