Credit card abuse still possible
One of the biggest patterns in the aftermath of the shopping and holiday season is the credit card bill exceeding limits. Credit card abuse interestingly could happen in many different ways and not just if the card holder uses the credit card too many times. Another important contributing factor is credit card fees and there a lot of different types of it. There have been quite a few federal regulations in recent times, which indicates that there is not more protection for the credit card customers. There are quite a few different types of card fees and charges which the customers need to be especially careful about. Two of the biggest charges are from the over-limit fees and the late fees.
There has been a lot of debate on whether the credit card interest rate should remain the same, increase or decrease. On the other hand, it has been seen that the balance transfer fees is increasing. This is the fees charged by credit card issuers when customers use a new credit card with special incentives to pay off the older credit card debt.
The balance transfer fee has been on the rise. At one time, there wasn’t anything charged at all. Then there was a balance transfer fee between 50 – 75 dollars. Currently a lot of credit card issuers charge a balance transfer fee of around 3%. Quite a few balance transfer cards though, do not charge any balance transfer fee to go with the low or zero percent APR in the introductory period to encourage the credit card customers. This new card could be a very attractive option for shopping leading customers to build up large debts after a spending spree.
The balance transfer fee is usually charged at the beginning. 4 -5% fee is expected to be charged on cash advances and balance transfers going forward too. This interest rate may not be charged on the balances but there could be an increase in the transfer fee which could add up to the balance though. There is a cash back offer for many customers too. There are attractive travel offers too for customers. However, customers have to very careful with these offers as they may need to pay annual fees on these cards when they are not used enough. Annual fee is not usually charged on the cards these days. However there are lot of solicitations from credit card issuers which customers have to be careful about.
