|
Author: Gerri Detweiler Article source: http://www.goarticles.com/. Used with author's permission.
Nearly 20 years ago I worked for a small consumer advocacy organization in Washington, DC. Each week we received sacks full of mail from consumers across the country requesting our list of credit cards with low interest rates and no annual fees. If you wanted a low interest rate on a credit card back then, you often had to apply to a bank in Arkansas where interest rates were capped by state law.
Those were the good old days.
Now, interest rates range from zero percent to a high 39 percent. It's tougher to find (and keep) a good credit card than ever before. That's because there are many new traps that can snag unsuspecting consumers.
At the top of the list is the "universal default clause" which allows issuers to monitor you credit report and raise your rate if you are late on any bill that appears on your credit report. One major issuer, for example, will hike a 0 percent rate to 24.99 percent if you slip up!
In fact, true "fixed rates" are rare. Many consumers don't realize that a "fixed" credit card rate isn't the same as, say, a fixed-rate mortgage. In most states, card issuers can raise the interest rate on a fixed-rate credit card with just fifteen days' written notice. The new rate can typically apply to existing balances as well as new purchases.
Fees are also on the rise. Take late fees, for example, twenty years ago a late fee on a credit card was still fairly unusual, and typically wasn't charged unless you were 15 days late with a payment. Now you often must get your payment to the issuer by a certain hour in the morning or you'll be charged a late fee of as much as $39. Go over the limit and you'll not only pay more interest, but a steep over limit fee as well.
Foreign travelers are often charged a "currency conversion charge" of 1 - 2 percent of the amount of their purchase. As the result of a class action lawsuit, Visa and MasterCard were ordered to provide refunds of those fees in certain circumstances. The problem wasn't that the fees were illegal, but it was determined they weren't properly disclosed. The case is being appealed.
Here are some findings from the nonprofit Consumer Action's annual survey of credit cards (www.consumer-action.org):
-- The vast majority of surveyed cards have significantly higher penalty rates that are triggered by one or two late payments in a period of six months to a year.
-- One-fifth of surveyed issuers have shifted to tiered late payments, which Consumer Action interprets as a deceptive way of charging higher-than-average late fees.
-- The number of cards with $35 late fees has more than doubled from last year.
-- More than half the cards surveyed require cardholders to pay only 2 percent of the monthly balance each month - a disturbing trend that dramatically increases the overall interest paid by cardholders.
-- More than one-third of surveyed institutions will not provide a firm annual percentage rate (APR) until they have screened the applicant's credit history. Instead, they give only a meaningless range of rates before screening, which makes comparison shopping difficult if not impossible.
Don't get me wrong - I am not saying that credit card companies should not make money. In fact, easy access to credit has helped fuel our economy, especially when the going gets rough. But many consumers now are literally trapped by high-cost debt with few options. I've spoken to consumers who feel they have no choice but to file for bankruptcy because their credit card companies all raised their interest rates to between twenty and thirty percent, and they simply cannot manage to pay the balances down. With all the landmines out there for credit card users today, the best strategy is still to pay down debt as quickly as possible and limit yourself to a couple of cards to avoid problems.
Sometimes, of course, that's easier said than done!
For more information on ways to build great personal and business credit, visit www.BusinessCreditSuccess.com. About The Author
Gerri Detweiler is considered one of the country's top credit experts. She has been interviewed for thousands of radio, television and print newstories including USA Today, The Wall Street Journal, The New York Times, Dateline NBC and many others. She has testified before Congress several times and worked on reform of the national credit reporting laws.
Sales Pipeline Forecasting Is There A Better Way?
In a recent survey of over 1400 technology companies Sales Directors and MD's said that they felt the key to gaining insights into why more and more selling eff...
Your IRS Tax Appeal Rights
Are you in the middle of a disagreement with the IRS? One of the guaranteed rights for all taxpayers is the right to appeal. If you disagree with the IRS about ...
The Inaccurate View of Science
Offering an alternative method of viewing science and our understanding of knowledge.
The Past, The Present, And The Future: A Compulsive Gambler’s Thoughts Through Poetry Part 3
The Past, The Present And The Future, A Compulsive Gambler's Thoughts Part 3 is a collection of poems that express what I was going through during the last ten ...
Are You Leveraging Your Business Network?
Connections are crucial for business success, but it's not so much who you know as who knows you. Don't become lax at maintaining your professional network.
The Most Important Number on Your Tax Return
What is the most important number on your 1040? Is it the taxable income, the tax liability or the refund amount? No, it is none of these numbers. The most i...
Proform Treadmills and iFit Technology – The Right Combination for Workout Success!
Proform treadmills are well worth considering. Good value for what you pay, with some impressive features.
Bloggedy Blog Blawg
About blogging and one man's discovery of a blog as a marketing tool.
A Backup To The Internet Is Vital & Now Cost Effective
It doesn't take a Terrorist Act, Tsunami or Earthquake to put a business heavily dependent on the internet in the dark and effectively out of business……for hour...
Knowing Your Customer Is The Key
One of the key success factors for any business is understanding what their customer's wants and needs are. Find out how you can gather this information, and w...
Internet Marketing is Changing Right Before Your Eyes!
There's no doubt about it . . . Big changes are in the air! In the midst of all the usual scams and rip offs, there's a New Wave of Marketing techniques that ...
Evaluation II
As I said in Part I everyone in the insane asylum looks normal, but at least the doctors are sane. Unfortunately, in the insane asylum known as the stock market...
Impressions
Even now, months after it happened, it surprises me when I think about it. No phone call. No heads up. No discussion. As I opened the email from a business asso...
Finding The Living Among The Dead
The dead that we speak of are those that use the scripture for their own lust and gain, those that use tragedy to gain unlawfully and those that are without und...
Babies Born With A Cleft Palate Or Lip
Many babies are born with a cleft palate or cleft lip. What are the causes and treatment?
Can A Golf Tip Online Help Your Game
A golf tip online can save you hours out of your schedule, but can it really help your game? With more and more people getting Internet connections, golfers ar...
Playing Low Limit Shorthanded Holdem Online
A guide to playing shorthanded holdem online at the lowest limits.
Just What is a Broker?
In most circumstances a broker is a third party to an agreement to purchase a commodity, the item being bought and sold is neither owned nor controlled by the b...
Self-Pleasure Tips for Women ~ Using Your Hands and Fingers
Finally, the final act in your regimen of self-pleasure tips for women: Touch yourself.
Improvising On The Piano: Jazz Musicians Do It -- Why Not Other Styles?
Jazz pianists improvise all the time. So why not classical pianists, gospel pianists, and piano players of many other styles?
Call No Man Father
Call no man Father A look at deception and Consequences. The institution of the Christian religion was and is still based on the words of Jesus and the Holy...
Animal Ethics
A long time ago, before evolution turned the primate into the businessman carrying a brief case, the topic of ethical considerations concerning animals was as t...
Choose an Acrylic Bird Cage
Acrylic bird cages can be mass produced or custom made. They can be found at local pet stores or large chains such as PetsMart or PetCo. They are also available...
Make Sure You Get The Customer Perspective
Businesses that fail, often forget to seek out the customer perspective. I have talked to some folks at businesses that were less than succesful, and when asked...
|
Print this page