Credit Card Dirty Tricks
|
There are many of us that have been badly stung by credit card companies that have charged exorbitant fees to use their credit cards. Several years ago an APR of 25% to 29% was common place which in simple terms means that if you borrow £1,000 your interest on that money would be £250 to £290 a year. Criminal when you think of it but I suppose we have to consider interest rates were much higher 8 to 10 years ago and there were fewer credit card companies on the market.
Today the low interest rates that we are experiencing have spurned hundreds of loan and credit card companies cashing in on the cheap cost of borrowing. To get approved for a loan or a credit card nowadays has never been easier. With the advent of the internet you can get approved for a loan or credit card in 10 minutes. So we all have a few 0%, low interest rate credit cards in our bags and wallets but lets find out a bit more about the sting in the tail of these cards.
1. Monthly Repayments:
Well done if you pay your bill off each month in full. Like most of us we only pay off the minimum monthly repayment; this is usually a % of the outstanding balance or no less that £5. Some credit cards will set the minimum repayment on a card at such a low amount that you inevitably end up paying the interest and nothing else. When this happens you end up with a compound interest scenario. Beware you could end up paying off a £2,000 loan for the next 20 years.
2. Credit Card repayment protection (CCRP):
Credit Card companies make a fair amount of money out of you when you use their cards. But wait they want to make some more. Just in case you die or lose your job they will offer you Credit Card protection for a monthly fee. These are usually over priced. Most credit card companies make a fortune out of these policies as most people don't understand how these fees are calculated so don't know there true worth. What most people are buying is the piece of mind.
3. Penalty fees:
If you do not pay on time you will be charged a late payment fine. These vary depending on your credit card company. The best way to prevent this happening is to set up a direct debit. You get charged for exceeding your credit limit. Again this is a very sneaky way for the credit card companies to make money off of us. Most of us will slip up without even knowing it and a charge of £25 can quite easily go unnoticed on our statements. Be diligent and don't give the card companies any excuse to make these charges.
4. Protection Plans:
This is another juicy money maker for the card companies. For an annual fee you will get protection on your card in the event of them being stolen, lost or used fraudulently. Most credit card companies usually don't charge for this and will refund you the money for any fraudulent transactions. I wouldn't suggest getting this.
5. Credit Limit increase:
You had a credit limit of £3,000 and have been diligently paying off your card every month and all of a sudden your new credit card statement says you have a credit limit of £10,000. You probably didn't ask for the increase but hey they gave it to you anyway. Psychologically this makes you think you have more money to spend but it is in fact a sneaky way of getting you to spend more money on your card. If you don't need it ask your credit card company to remove the new limit.
6. Foreign transaction chargesIt is usually quite convenient to use your credit card abroad on holiday or on a business trip. No need to carry large sums of foreign currency around with you. But wait for it ??.. You will be charge for this privilege (not surprised I am sure). You will be charged a commission depending on the amount you spend abroad which can vary from 3% to 5%.
7. Cash withdrawal charges:Not much new here. If you withdraw money from a cash point using your credit card you will be charged for the privilege. Remember nothing slips through. Card companies can charge in the region 3% of the amount drawn and the bad news as if this isn't bad enough, you won't benefit from any promotional 0% introductory offers that are currently running on your card.
As you can see credit card companies make money from us in more ways than we in most cases are aware of. Be smart and remember all these crucial aspects when using your credit card. You may be one of the few that limits the credit card companies from only making the bare minimum from you.
Grant Marwick is a freelance writer and owner of http://www.only-credit-cards.co.uk where you will find advice and more articles on Low interest Credit Cards and 0% Credit Cards
|
|
|
How To Improve Your Credit Rating
So you got into debt, had problems but you got yourself back on your feet through hard work and sacrifice and how are you rewarded? A Bad Credit Rating.You would be forgiven for thinking thats not fair and why did you bother sorting yourself out if your hands are still tied when it comes to applying for anything financial? There are ways to improve your credit rating and get back on track completely.There are three basic steps to help improve your credit rating:· Dispute negative entries on your credit report· Have negative entries de...(related: Credit)
Five Reasons To Repair Your Credit Score - You Can Do It Yourself
There are multiple reasons that tell us why we should have a 700+ Credit Score, but these five facts will definitely give you the big picture and hopefully will drive you to want to fix your credit score starting today.Fact #1: Did you know that consumers with Credit Scores of 700+ are likely to get interest rates up to four points lower than those with scores under 640.Fact #2: People with Credit Score below 620 won't get approved for a home mortgage 97% of the time. Therefore if this is your case, yo...(related: Credit)
Credit Card Rates - Negotiating Rates With Your Credit Card Company
Ok, let's face it, everybody hates high credit card rates, and they drain hard earned money out of your wallet. As a valued consumer, it is apparent that you learn how to negotiate to get the absolute best rate that you possibly can. The good news however is that it doesn't have to be a difficult or time-consuming process. In fact, it can be very easy indeed if you know what you're doing. In this article we will discuss the ins and outs of credit card negotiating to ensure that you get the best possible rate with the least amount of effort.1. First and foremost, you should figure out if you even want to continue using your current credit card company. Are you pleased with the overall se...(related: Credit)
New Credit Advice: Dont Pay Off Those Credit Cards!
Credit needed for real estate mortgage financing differs from credit needed for consumer loans. If you need help getting a home mortgage, these credit tips will help you.Contrary to what many credit advisors say, paying off credit cards each month is not always the best action to take. When making credit card payments, don't pay the balance in full each month -- let a little roll over. Carry a balance on your credit card every other month --as little as a dollar. Paying balances in full does not increase your credit score; paying balances in full may in fact lower your credit score. Accounts with zero balances do not compute significantly in your total score. For instance, a credit card with a perfect payment history and no balance will not raise your credit score as muc...(related: Credit)
Credit Report Disaster Through Mistaken Identity
I've got some very important info I want you to think very seriously about. I'm sure by now you've heard of Identity Theft,...heck you may have even been affected by it. I know many of my friends have.But how about what may potentially be even a more dange...(related: Credit)
All About Balance Transfers
What is a balance transfer?A balance transfer can be explained simply as a balance transfer! When a balance is transferred usually from a credit card, but p...(related: Credit)
Update Your Computer System With Bad Credit Computer Financing
The moment I placed myself in front of the computer screen a whole new world beckoned me to join it. And years of strolling have proved incompetent to get me acquainted with the full panorama of computers. You have always wanted one in your home. But something is stopping you. Bad credit? Do I hear bad credit? You think bad credit can stop you from getting your computer financed. Which world are you living in? You certainly need a computer. Computer financing for bad credit can enable you to get your very own home computer, lab tops, desk top or any other computer requirement.Credit can be marred at any stage due to a number of reasons. Lat...(related: Credit)
How To Repair A Bad Credit Rating
If you have a bad credit rating, then you might find that your ability to get financing, loans, and even some jobs is greatly diminished.Once you have a bad credit rating, it might seem like there's nothing that you can do about it? but you don't have to believe that. It's not as difficult as you might think to get by with a bad credit rating; with a little work and time you can even repair it! Of course, before you do that it's important to realize exactl...(related: Credit)
How To Get A Low Interest Credit Card
Consumers often have the first credit card that they ever applied for, never really analizing how the interest rate affects their payments, but many other options exist and can help consumers decrease their payments and achieve financial stability.With interest rates on some credit cards rising to over 23%, even low balance credit card debt can be crippling. One of the first research elements a prospective borrower should look at is the interest rate on transferred debt. This interest ra...(related: Credit)
Why Should You Use Credit Cards
Believe it or not, the way society, especially the commercial side, is set up these days, the only alternative to using credit is to pay cash for everything. But it's actually quite hard to do that. For example, if you want to rent a car, you have to have a credit card, even if you pay cash for the rental. The reason for that is because once a company has your credit card with your signature, they'll never lose money. If you default on anything, or if extra charges come up later, all they do is charge your credit card. Many companies require a credit card before they'll do any kind of business with you, for that very reason.After you enter the workforce, it's a good idea to apply for a credit card ...(related: Credit)
Credit Score ? For Scoring The Right Loan
Somebody once said, "There is always a way of knowing your limitations and going beyond it." It is fundamentally true with respect of credit score. There can be nothing more rewarding during loan borrowing than knowing your credit score. There are many people who are practically unaware of what their credit score is; in fact they don't even know what it means. This credit scoring system has been used since many years to decide whether a borrower is a credit risk or not. Your credit score is immensely decisive in the acceptance and rejection of your loan application.What is a credit score?Credit score is a statistical method to assess the credit worthiness of a prospective borrower. Credit score has all the in depth information about ...(related: Credit)
Compare Credit Card Offers And Reward Yourself
Here's a simple system on how to pay zero interest and get tons of free stuff. Almost everyone uses credit cards. But only a few thousand people out there take advantage of what the credit card industry is really offering.<...(related: Credit)
site-map - Copyright © 2007 | Contact Webmaster | All Rights Reserved | Free Articles and Information | Credit