Credit Card Traps

1. No Reason To Raise The Rate But They Did...
The agreement between you and the card company probably includes a clause that says they can raise the interest rate without reason or cause. If this happens, call them up and request a lower rate.

2. Balance-Transfer Fees And High Rates...
Balance transfers can be great, but only if you are aware of possible fees and rates. Many times, the low transfer rates are only good for a limited time, like six months, then the higher rates begin.

3. But It Was Still Late...
Say you negotiate with a credit card company to reverse a late payment. You might feel good about the short-term victory, but they can and probably will raise your rate because the payment was late. 

4. Cash Costs More, Lots More...
Cash advances with your credit card incur high rates, additional fees and immediate interest charges. Read your Terms and Conditions. A charge card is not a debit card!

5. Currency Exchange Fees...
In addition to the standard currency exchange fees, some major banks are charging a 2 to 3 percent fee on credit card and debit card purchases made outside the United States. Your vacation could cost more than you thought.

6. Customer Service...
First, you must have someone to talk to. Then, remember they record the conversations so be nice. Last, they are looking at a database that has more info about you than anyone else. The rule is to be prepared and write down notes on the conversation. Remember, the more they delay or stall, the more they make since everything is tied to timeframes and payment schedules.

7. Disability Coverage Insurance...
Simple to sign up, but in practice complicated to use or cancel. Be sure to read the policy language to ensure that you understand the policy qualifications, exclusions, and limitations. Since credit insurance is sold without a comprehensive application or screening process, it is necessary for you to make sure that you qualify for the coverage you are purchasing. Also, it can be difficult to cancel because the actual carrier may be hard to find.

8. Fixed Rate...
Fixed rates can change.  All the credit card company has to do is give you notice in accordance with the agreement.

9. Grace Periods Are Less Graceful...
The period of time, generally 20 to 25 days, from the billing date of your last credit card bill to the due date of your current bill, when you can pay in full without being charged interest. Many credit card companies are shrinking that time down to 20 to 25 days. Since monthly billing is the norm, you will almost certainty start paying interest on your charges before you have a chance to pay for them. More...