November 2, 2009
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Becoming Savvy About CC Fees, Pt.1
Recognizing hidden fees.Most of you have heard about the unfair practices occurring in the credit card industry where lenders have been raising interest rates to near loan sharking levels. Most likely, you have also heard how lenders have been using hidden and confusing fees as a means to scam even more money out of Americans. Most credit card companies participate in these practices which typically are passed onto the consumer through fees and surcharges; hidden no less. You might think you're hands are tied and there isn't much that can be done. However, with perseverance and education on how to recognize and avoid these deceptive credit card scams, you will prevail.
It's no secret; credit card companies make a bundle off fees and surcharges. Last year, Americans paid over $30 billion in credit card associated fees. New legislation that regulates how lenders implement interest rate increases will soon be enacted. We can expect to see more fees as lenders search for alternative methods to earn income. Alert consumers have the ability to recognize and avoid these fees by making good choices. A good example is the balance transfer fee. Zero percent sounds very inviting, however, most lenders charge a fee to transfer that balance. At one time, balance transfer fees were 3 percent; however, over the past few months, many lenders have increased the fee to 5 percent. You can save hundreds of dollars if you choose wisely and only accept balance transfers that do not charge a fee.
The old late fee will get you every time. If your payment is even one day late, and in some cases, one minute if you are paying online, you will be accessed a late fee. Not only will paying your credit card payment late render high penalties, it will also lower you credit. The best way to avoid late fees is to call or sign up online for automatic payment. This will guarantee you payment arrives on-time, save you time and money, and protect your good credit rating.