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All About Credit Cards
Here's important information about:
Like most consumptive activities... moderation should apply. Unfortunately, it doesn't always work that way. How many pre-approved offers have you received lately? Most have low introductory rates and enticements. Many of them create a sense of urgency for you to say "yes" before their offer expires. The problem is... sometimes you simply can't say "no". The Annual Percentage Rate (APR) is a primary indicator for the cost of credit and is expressed as a yearly rate. It must be disclosed before you accept any obligation for payment. The card issuer also must disclose the periodic rate. This rate is applied to your outstanding balance to determine the finance charge for each billing period. Some credit card deals permit the issuer to change the APR when interest rates change. Make sure you understand how these variable rates work before you become obligated. A grace period lets you avoid finance charges by paying your balance in full before the due date. Knowing whether a credit card gives you this option is important if you plan to pay your account in full each month. This is especially true if you plan to transfer an account balance from an old card onto a new one. Although it has become common for card issuers to provide no fee accounts, most continue to charge an annual membership or participation fee. These range from $25 to $50 and sometimes up to $100 depending on the color (eg. gold or platinum) of your card. Try to avoid those sneaky little charges (actually they're not so little anymore) for such things as cash advance, late payment or exceeding your credit limit. Some companies even charge you for not using your card... for example, when your account has been dormant for a certain period of time. One of several methods will be used to calculate your outstanding balance. This can make a big difference in your finance charges. Read the fine print and, if you don't understand how your balance is calculated, ask the card issuer. A written explanation must also appear on your billing statements. Some credit card offers have a minimum finance charge even if the actual amount of your finance charge is less. For example, your computed charge may be 35 cents, but, the issuer's minimum finance charge might be $1.00. A minimum charge typically applies when you must pay a finance charge when carrying over a balance from one billing cycle to another. Other options to consider are things like is the credit limit high enough... how well-accepted is the card... and the plan's services and features. For example, you may want an affinity card that is sponsored by a professional organization. Or, maybe you want to select from among several small business credit cards, in order to better identify and organize your work expenses. Federal law prohibits issuers from sending you credit cards you didn't request, but they can send you a renewal or substitute card without your permission. Issuers also may send you an application or a solicitation. Prompt payment is critical if you want to avoid unnecessary charges and credit report problems. To help avoid finance charges, follow the issuer's mailing instructions. Payments sent to the wrong address could delay crediting your account for up to five days. If you can't find the payment envelope, look for the address on your billing statement... call the company... or make a direct payment using their website. When you pay more than the total current balance, you can keep the credit on your account or ask for a refund, if it's more than a dollar. This must be issued within seven business days of receiving your request. If a credit stays on your account for more than six months, the issuer should make a good faith effort to send you a refund. If you find a mistake on your bill, you can dispute the charge and withhold payment for that amount while the charge is being investigated. Of course, you still have to pay any part of the bill that's not in dispute, including finance and other charges. If you do dispute a charge, make sure you follow the company instructions exactly. Write to the creditor at the address indicated on your statement for "billing inquiries." If your dispute reaches the creditor within 60 days after the first bill containing the error was mailed to you, the creditor must acknowledge it in writing within 30 days of receipt. When your credit cards are used without your permission you can be held responsible for up to $50 per card. If you report the loss before the card is used, you should not be held responsible for any unauthorized charges. Report the loss as soon as possible in order to minimize your liability. Some issuers have 24-hour toll-free telephone numbers to accept emergency information. Be sure to follow-up with a letter to include your account number, the date you noticed your card missing and the date you reported the loss. You can dispute charges for unsatisfactory goods or services, if you made the purchase in your home state or within 100 miles of your current billing address. The charge must be for more than $50. These limitations don't apply if the seller also issues the credit cards... or, if a special business relationship exists between the seller and the card issuer. Of course, the courteous thing is to first make a good faith effort to resolve the dispute with the seller. No special procedures are required to do so. If all else fails, you may want to consider filing an action in small claims court.
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