Read the Small print for your Credit Cards
Every day the companies that issue credit cards find new tactics and strategies to attract more consumers. Make sure you read the correspondence that arrives in your letterbox because it can be very useful in advising you of changes imposed by the credit car provider. Your credit card provider can change its interest rate just by a note sent in writing by post. It is important that you understand and familiarise yourself with all of the terms and conditions that relate to the credit card.
Most people tend to ignore the terms and conditions that are issued by there credit card provider but they can find themselves being caught out as a result and without realising they are charged for late payments without realising what the penalty applied by the card provider will be.
Changes in the interest rate that is applied to the credit card by the bank or other card provider are announced generally in pamphlets or letters that arrive with your bill so make sure you read the enclosures that come with your credit card bill. Look out for the words "Important Notice of Change in Terms", which with a credit card means "important Warning of change of to your credit card terms". Many card providers offer temporary interest rates in very great reductions for a limited period but you must read what it is written in very small print to understand the exact terms of the offer. For example note the fact that the special offer interest rate will run for a fixed period. If you don’t read the terms and conditions then you wont know when the credit card interest rate changes to the standard APR rate.
The companies that provide credit cards can increase the annual interest rate (APR) with giving only a limited number of days of warning of the change.
With bank accounts ask your bank if the increases in the interest rate depend on other factors in addition to the way in which you have made your payments. Some banks will noticeably increase its interest rate because the balance on your cards has reached a certain balance or the limit of your credit.
The terms of the credit card will often say that your minimum payment must be received by a certain date. If your payment arrives only one or two days late the bank or other credit provider takes, a penalty charge. This charge, which is added to the balance on your credit card, can often be £20. So even if you make the required payment to the card provider you could still be charged because the payment arrived with them late. Consider that the post can be delayed so if you pay your credit card by cheque make sure that you send the cheque in plenty of time. Also beware of the fact that with some card providers If you are late in your payment in any one month they can, if there terms and conditions provide for it, increase the interest rate of interest on your credit card. This sort of information will always be contained in the terms and conditions because the credit card provider is legally required to provide you with the terms of your agreement with them. |
