Credit,Card,Traps,And,How,Avoi finance, share, loan Credit Card Traps, And How To Avoid Them

If your financial problems have reached the point where you do not see a way out and you feel as though you are drowning in debt, your best way out is through declaring bankruptcy. Filing may well allow you to get your finances back on track Thankfully, there are now several web sites that are there to help people like you with bad credit to find the fast personal loans that you need. When you have bad credit, the first thing that you should be looking for is a loan company that

"0% interest* for the first six months, no annual fees**and a low fixed*** rate of only 8.9%****!"* Unless you count the deferred interest we will charge youif you don't pay off the full balance transfer amount whenthe promotional period ends.** Except the ones we charge for "late payments****", goingover your balance, cash advances, balance transfers,membership in "rewards" programs, etc., etc., etc.*** Fixed for the first month, but after we may change itwithout notice for: late payments, going over your balance,changes in the prime rate, or just cause we want more ofyour money.**** Rate depends on your credit score. (Which we alreadychecked and intend to charge you 19.8% or we wouldn't bothersending you this great***** offer.)***** A payment may be late if we just don't get around toprocessing it in time no matter when you actually mailed itto us.****** May not be great in all states.Yes, folks, "the devil is in the details" and the truth isin the fine print.While this is obviously an exaggerated and fictitiousexample I have seen most of these "weasel" clauses in the100s of credit card offers I receive each year.Some of these tricks and traps are practiced by local andnational merchants with their "store credit cards" and"discount cards".I have seen stores and even car dealerships make "nointerest for a year" type announcements and advertisements.But when you actually read the contract (and who does that -they count on you to not read the whole thing and youprobably won't understand it without your attorney) you mayfind that instead of the regular payments you would expectto start at the end of the no interest period, you arerequired to pay the full purchase price.If you want to make installment payments, you will berequired to pay the payment plus the interest (look for therate in the fine print) and you may also be required to paythe interest that accrued during your "interest free"period. Gotcha!Or how about the "no annual fees" bit. Look out for thecontract to say "no annual fees FOR THE FIRST YEAR". Orfirst two years or that a "membership" fee is required. Howthat differs from an "annual fee" is beyond me.Also watch out for the "no annual fees" for the use of thecard but "membership fee required" to participate the infrequent flyer miles or cash back points program (which wasprobably why you chose that card to begin with). Gotcha!And how about the "fixed" rate? Read the fine print, itwill actually say "subject to change without notice". Is itjust me or do I misunderstand the meaning of the word"fixed"?Also your "fixed" rate may be raised to the "maximumallowable by state law" if you go over your credit limit(including fees that may put you over your limit before youeven know it), make a late payment, miss a payment or do notpay the full amount. Gotcha!And then there is that low "teaser rate". Yes that's whatit is called in the industry and it is appropriatelydescriptive. That rate is given out, they aren't lyingabout that. But it is only given to the people who have 700or above credit scores, minimal debt, and a high paying job.The majority of the people who are sent the ad will not getthe lowest rate. But you won't know your rate until youapply for the card. But by the time they tell you what rateyou will be at they have already signed you up and issuedyour card.They count on the fact that most people will just accept therate and go from there. Gotcha!So how can you avoid these traps?Rule #1, read ALL of the fine print. If you are not clearon something ask someone else what they think it means. Askan attorney friend, CPA (certified public accountant),financial planner, banker or other person in the financialindustry. Chances are they will have several questionsabout the fine print, too.Rule #2, don't apply for a card unless or until they tellyou what your actual rate will be. This is hard becausemost of them are not set up to tell you. Generally you willneed to know your credit scores and have a copy of yourcredit report handy.Even then you are unlikely to find someone through theirtelephone maze that will or can actually answer yourquestion. Try to find a card that gives you a confirmedrate before you apply. A conscientious company will firstrequest a copy of your credit report from one of the creditbureaus before quoting you a rate.Look on http://www.bankrate.com for current rates offered byvarious credit card companies and banks. Often smallerbanks and companies offer better deals and are not as strictor hard to deal with. Check with your local banks also. Atleast with a locally issued credit card "you know where theylive".Rule #3, always mail your payment at least 7 days before itis due. Or try paying through the Internet. Many companiesnow offer that payment method. It can also save you timeand stamps.Rule #4, check your statement each month to be sure you arestill at the interest rate you signed up for. If your ratehas been increased, look for a late payment fee, or someother reason for the increase. Call the company and askthem why they increased your rate.If your rate was unjustly increased (they processed thepayment late or credited it to your account late, but it wasnot received late) then ask them to change your rate back towhat it should be.Even if you did make a late payment, most companies willreduce your rate after six months of on-time payments. Butif you don't ask, they will keep you at the higher rate aslong as they can.In the credit card business it is definitely "caveat emptor"or buyer beware! Article Tags: Credit Card, Fixed Rate, Fine Print, Annual Fees, Late Payment