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Don’t be (April) Fooled by Your Credit Card Companies

Credit card companies are known for tempting us with juicy offers that usually sound too good to be true… and likely are.  Even if you have a credit card or twelve, credit card companies have all kinds of tricks to run up your bill and separate you from your money.

Here are some of the ways credit card companies try to pull one over on you and me.  Watch out for these sneaky tricks they play.

Reverse the late payment, but…

There are times when a credit card company will forgive a late payment but you could still get punished.  It happens to all of us, you think you made your credit card payment but you didn’t, so when you did make your payment it was late.  You figured you would call the credit card company and ask them if they could waive the late charge, after all you have been a customer for over 10 years… “Sure, since you have been suck a great customer floor the last 10 years, we will gladly reverse the late charge, no problem,” Awesome!  You just got your late charge removed, good job.  The only problem is if you were to check your next month’s statement, you will likely find that your interest rate has just made a significant jump into the double digits.  How could that be you ask?  Well, you were late… and in many credit card contracts it specifies that should your payment not arrive by the due date, they are allowed to raise your rate.

Missed it by minutes…

You made your payment on the due date, why have you been charged a late fee?  Even a few minutes late could cost you money.  Just because your statement says that your credit card bill is due on the 1st of the month, that doesn’t mean it can’t be late if you pay on that date.  Huh?  Some credit cards have it spelled out in the credit agreement that payment is due by 1 p.m.  So if your payment posted after 1 p.m. on the 1st, you would technically be late and the wonderful credit card company can charge you a late fee.  The best way to prevent this and other late fee problems is to make sure you pay your credit card bill early.

Credit card theft insurance…

Many credit card companies will try to sell you credit card theft insurance to protect you from an unauthorized charge on your card due to loss or theft.  The truth is, it is very likely that if someone steals and uses your credit card, it won’t cost you anything. Federal law limits your liability to $50.  If you lose your card or notice a charge that you did not make, the best thing to do is get on the phone with your credit card company as soon as possible and let them know what happened.  There’s a good chance that the charge will be remove right then while you are the phone.

Monthly payment due, $0.00…

Wow, that’s nice of the credit card company, they somehow must have known that money was a little tight this month and decided to let you skip a payment.  Don’t be fooled, just like the crazy low minimum payments, the $0 payment does nothing but add money to your balance.  If you do not make a payment, you do not reduce your balance… but the monthly interest is charged no matter what.  If you get your statement and see that your monthly payment is $0, don’t be fooled, make a payment anyway.  By skipping a payment or making only the minimum payments, it will take 134 years to pay off your credit card balance… well, maybe not that long, but it will feel like it.

So, read your credit card agreement, make your payments early and be weary of anything that sounds too good to be true, and you will avoid being fooled by your credit card company.

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