Different ways credit cards can fleece you - Other News

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Different ways credit cards can fleece you

Different ways credit cards can fleece you

Different ways credit cards can fleece you
The content is accurate at the time of publication and is subject to change.

There was some exuberance when President Obama had signed the new CARD Act, which put an end to faulty card practices such as late billing, sudden increases in rates, etc. However, credit card companies are a clever, and they always seem to find newer and innovative ways to increase fees on one pretext or the other. They are making up for their lost revenue through these deceptive charges and tricky strategies.


A few examples of how credit card companies are manipulating the rules are:



  • Rates are increased on prime customers and the ones who pay on time. The increase is around 30%.

  • Penalty rates have been hiked even if there is only one day’s delay in payment.

  • The credit limits have been reduced without notice.

  • Obtaining a new credit card has become much more difficult.

  • The credit score of prime customers will eventually be raised. Hence the numbers of subprime customers will automatically increase.

  • Cash advances as well as balance transfer fees have been increased.

At least 40% of banks have, or will increase their annual fees in the near future. If the existing fee is $29 it would be increased to $99. The rates are converted to variable ones now, especially when the prime index rate is really low and this is most likely to go up.


Issuers are finding ways and means to charge customers ‘fees’ even on regular transactions. For instance, they are charging an international fee, even when the transaction done is in dollars. Credit card issuers are also cutting back on rewards programs. For instance, the threshold to qualify for a free flight has been increased. Getting cash back is also much higher, especially when this increase is one millions of customers nationwide. The inactivity fee is added when the card is not used, and there is also a low activity fee if the transactions fall below a certain category.


There is closure of accounts without prior notice. For instance, a card could be declined and one may later get to know that the card has been cancelled. As per the Federal Reserve study, more than half the banks are likely to cut credit as customers are forced to spend less.


In spite of all these drawbacks one can still stay on track by spending appropriately and paying on time. Avoid the credit cards that come with tricky introductory rates. Pay bills several days in advance to avoid late fees and pay the full amount. Do not cross the credit limit. Never spend on something that cannot be afforded. Seek help when in trouble.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

New Travel Benefits for Mastercard World and World Elite Cardholders

Posted: October 18, 2018

Mastercard has upped the ante when it comes to travel for Mastercard World and World Elite cardholders by adding two new benefits into the mix. Now cardholders get access to Mastercard’s Hotel Stay Guarantee and Lowest Hotel Rate ... Continue reading
Paying Bills is Getting Easier with Mastercard Bill Pay Exchange

Posted: October 17, 2018

MasterCard is looking to help consumers pay their bills more easily and quickly with Bill Pay Exchange, a new digital solution they are launching. The Bill Pay Exchange will let people manage and pay all sorts of monthly bills ranging from ... Continue reading
Synchrony and JCPenney Are Still Partners

Posted: October 16, 2018

Synchrony and JCPenney have inked a multi-year deal extending their strategic partnership, which includes their private label credit card program and the JCPenney MasterCard. This extension means that the two will continue to work together ... Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com, or wholesale clubs up to the quarterly maximum each time you activate.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the Miles you've earned at the end of your first year, automatically. For example, if you earn 30,000 Miles, you get 60,000 Miles. That's $600 towards travel!
For Excellent, Good Credit
Earn 2% cash back on purchases: 1% when you buy plus 1% as you pay
For Excellent, Good Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!