Buyer Beware: Charges for Everything
In their never ending quest for profits, credit card companies have raised their fees for everything. Some of the most annoying tricks in the trade:
- They charge ridiculous amounts for late payments.
- To make it more likely that you will have to pay late fees, they have reduced the time they allow from the mailing of the bill to the date your payment is due.
- The “over limit” charge. If you try to charge more than the line of credit you have on the card they may or may not accept the charge but they will charge you a fee for trying!
In comparison to the amounts of money involved, all of these fees are huge. And they can mount up so fast it will make your head spin.
I know someone who got sucked in by one of those special credit card promotions in a store. She applied for a credit card she did not need and got some special deal. Unfortunately the credit card company did not get her address right, so she never got a bill. When this was finally corrected (and it took several months), the original $30 charge had risen to $180 with interest and late fees. It took her three more months to get those charges reversed.
Not paying attention to these tricks of fine print by your friendly credit card company, can cost you hundreds of dollars per year. Remember, the credit card company needs to make money over and above the amount they charge a merchant for using the card when the card-holder purchases something. Use your credit card wisely. Read the fine print, and pay your bills on time.
The consumer response center of the FDIC has more information on "Choosing and Using Credit Cards".
Another tip to avoid finance charges: use the payment envelope included with your bill. If you send a payment to the wrong address, there will most likely be a delay in crediting your account, and therefore a fee. If you loose the specific billing address, call them and ask.