 |
|
|
||
|
|
|
Lower Credit Card Fees?The Office of Fair Trading has been working for the last two years to come to some kind of agreement to get the credit card fees lowered. The fees were extremely high before 2006 when they placed a cap of 12 pounds on the companies. However, upon recent research by analysts and even though the companies have complied with this lower fee they have been trying to get their losses back in other ways. The revenue they have lost means they are increasing fees and rates in other areas. The purchase rate on a credit card two years ago was 14.9 percent. Now the average from most credit card companies is 16.4 percent. This difference means that the consumers are actually paying more on their card than they were before the fee changes. Those who only pay the minimum balance are the ones suffering the most. For example if you have a balance of 5,000 pounds and you pay 2.5 percent per month as the minimum balance of that amount you will pay over 750 pounds during the year more from the interest increase that was just 1.5 percent. Other interest rates on the cards have changed as well. The cash advance options have increased from 18.1 percent on average to 24.3 percent. A lot of the cards for balance transfers and cash fees were charging 2 percent or a minimum of 2 pounds. This rate has increased to 3 percent or 3 pounds. It means anyone who has used the cash advance options are paying more and struggling harder with their monthly expenses. So the credit cards have just made a bad and unfair situation worse. Something one must consider is shopping around for a new credit card. A consumer shouldn’t look for the best credit card deal on the market, but the best credit card deal for how they will use the card. For consumers it is how the card will be used and how quickly they can pay off the balance in order to save money. For consumers who get cards with zero percent balance transfers for 12 or 15 months they will find help, but not if they use the card wrong. The balance transfer will be paid down before any purchases, which means the consumer could still be paying out a very high interest if they use the card for purchases and balance transfers rather than paying the card off. Back To Financial News June 2008 100 Percent Mortgages |
|
Home | Contact | About Us | Terms and Conditions | Privacy Policy | Sitemap Credit Cards | Loans | Business Finance | Insurance | Debt Solutions | PPI | Bank Accounts | Financial Information |