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Beware of Credit Card Company Interest Rates and Fees   Credit card companies are coming up with some rather devious ways to get more and more money from consumers.   Late fees and over the limit fees are much higher now than they were a few years ago. The average for each of these fees is now around $35.00.   It used to be that if your payment arrived by the due date, credit card companies wouldn't charge a fee. More often now, it is the time and not the date your payment arrives that matters. Even if your payment arrives on the due date, you might be charged a late fee because it arrived after the credit card company's cutoff time. Another way credit card companies increase the chances of consumers being late on their payments is by changing the day of the month the bill is due. It is easier for people to keep track of payments that are due on the same day of the month. If a bill is due on the 27th one month and due on the 24th the next month, it can easily cause confusion, especially for consumers with several credit cards. By changing the day of the month payments are due, credit card companies can rake in lots of extra dough from late fees. Credit card companies will use any excuse to increase their customers' interest rates. They'll run your credit report and if it's less than perfect, they'll increase your interest rate. If your cards are maxed out, they might increase your interest rate for that, too.   Then, there's the Balance Transfer Scam. Consumers are tempted to transfer their balances from one credit card to another with the hopes of getting a better interest rate. Many people who apply for "pre-approved" balance transfer deals get burned because the new company claims that they don't qualify for the preferred rate. Also, the company charges a fee to transfer the balance. If you transfer from a 15% interest card to a 13% card, it can do more harm than good if you have to pay a 3% Balance Transfer Fee.   Some credit cards companies are running a collection agency style scam. Consumers who have defaulted on a credit card bill could receive an offer from another company for an appealing credit limit. What consumers usually don't realize is that their old balance gets added to their new card. This is one of the many reasons it is important to carefully read the fine print of everything you receive from credit card companies.   Shrinking Grace Periods are another way credit card companies rip off their customers. This increases the chance that consumers will not pay their balances on time and will have to pay the interest.   Annual Fees. What's that about? It's just another way for credit card companies to steal more money from consumers. Cash Advance Fees are a big ripoff, too-- not to mention the higher interest rates that they charge for purchases.   0% interest for 12 months? Better read the fine print. If you can't pay off the entire balance in 12 months, the interest from that 12 months will be added to your balance! This type of scam is called "deferred interest" and you can read more about it here.   Did you know that merchants who accept credit cards are getting ripped off, too? Credit card processing companies charge them a monthly fee, a billing statement fee, and a customer service fee. PLUS, they take up to 4 percent of the amount the customer pays to the merchant. Just think, if you were to start a business and accept credit card payments, you would be ripped off both as a consumer and as a business owner.   Even if you are never late to any creditors and never go over the limit, credit card companies will still increase your interest rate-- even with the billions of dollars they got from the taxpayer bailouts.

 

 

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