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Dear Liz: Can we really trust the banks anymore to adhere to the terms they offer us? I liked your suggestion about using low-interest balance-transfer offers to speed up debt repayment. However, one of my credit card issuers has both increased my minimum payments and lowered my limits on my credit card and line-of-credit accounts. When I asked why, they said, “Because we can.” So when they send me a set of balance-transfer checks with a 1.99 percent interest rate, I don’t trust them to keep their word. Now I am just concentrating on paying off the balance as soon as possible and will keep the card only for emergency use.

Answer: Balance-transfer terms aren’t quite as sacrosanct as they used to be. A few lenders have boosted their minimum payments, and Chase tried charging a $10-a-month “inactivity fee” before customer outrage forced it to back off.

But the biggest risk with balance-transfer offers right now isn’t that lenders will renege on the deals midstream. A greater concern is that the good deals are getting scarcer. It’s possible that when the low teaser rate you’re offered expires, you might be stuck with a double-digit rate and few options to get a better deal.

If you can pay your debt off before the low rate expires, and you would save money even after taking into account the 3 to 4 percent balance-transfer fee most lenders charge, then you might want to consider one of those low-rate deals. Otherwise, consider looking for a card with a low regular interest rate. Check with your credit union, sites like www.cardratings.com or www.creditcards.com, and the finance forum at www.fatwallet.com.

Dear Liz: I have no idea what my credit score is, because as my father said, “You never get rich paying someone else interest.” The only reason to borrow money is for a house or a car or for a home improvement for which a home-equity loan would be best. Credit cards, consumer loans and home-equity loans for non-house expenses are folly.

However, you and many other financial columnists are always advising people on how to keep their credit scores high. The implication is that your readers should be borrowing money when they should not. I use credit cards (for most of my purchases, in fact), but I always pay off my balance, so my credit scores are of no interest to me and I don’t know them.

Answer: You’re laboring under two common misconceptions: that credit scores aren’t important and that you have to have debt to have good scores.

It’s precisely because you don’t get rich by paying others unnecessary interest that you should care about your scores. The reality is that good scores have become critically important if you want the best rates and terms on mortgages, auto loans and other lending.

Credit scores are also used by landlords to evaluate applicants and by insurance companies to determine premiums.

But you don’t need to carry credit card balances to have great scores. In fact, the only smart way to use credit cards is to pay your balances in full each month. You also need to pay attention to your credit limits, since maxing out cards, even if you pay in full, can hurt your scores.

Dear Liz: I have a pack-rat mother. During my most recent “purging” of her boxes of papers, I found a cashier’s check for almost $2,000. The catch is, it’s dated Jan. 15, 1986, and was issued by a bank that’s since been acquired. What are the chances of the acquiring bank honoring the check? My mother is wealthy enough for this to be an amusing, albeit embarrassing, story, but I hate the needless waste of money.

Answer: You and your mother can present the check to the bank, but most likely you’ll be directed to your state escheat office, where unclaimed bank funds typically end up. You can find a link at www.unclaimed.org, a site run by the National Assn. of Unclaimed Property Administrators.

Liz Pulliam Weston is the author of the book “Your Credit Score: Your Money and What’s at Stake.” Questions for possible inclusion in her column may be sent to 3940 Laurel Canyon Blvd., No. 238, Studio City, CA 91604, or via the “Contact Liz” form atwww.asklizweston.com.

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