The next time you open your credit card statement, take a closer look at
small insert titled “changes to your credit card agreement”. You know one I’m speaking about. It’s that small, folded paper written in legalese that you promise to read some other time (but of course that time never comes) or you just discard it with other “junk” inserts. First and foremost you must understand that using your credit card after you’ve received this notification results in your automatic “agreement” to new terms in notice. To prevent these new terms from affecting your account you must stop using that credit card immediately or by date given in notification statement.
The most common modifications to credit card agreements include new APR’s (annual percentage rates), new fees and/or changes to existing fees, or a change to grace period on your account. The grace period is number of days during which any credit used for purchases may be repaid in full without incurring a finance charge.
Not knowing or not keeping track of dollar amount limit on your card is another trap you should avoid. Credit card issuers will allow you to charge a small amount over limit set on your account. However, don’t be surprised when you get hit with an “over limit fee”, usually around $35.00 or higher, on your next statement. Also, be prepared for your APR to be increased if you go over your credit limit.
You’ll also trigger an increase to your interest rate if you miss your payment due date. Some companies consider your payment late if not received by noon or 1 p.m. on date due. Along with higher rate, you’ll also pay a “late fee” of $29 on up. Be sure to use company’s preprinted envelope when sending your payment. These envelopes allow pre-printed bar code to be scanned by post office so that it can be delivered more efficiently.
