Credit Card Dirty Tricks

There are many of us that have been badly stung by credit card companies that have charged exorbitant fees to use their credit cards. Several years ago an APR of 25% to 29% was common place which in simple terms means that if you borrow £1,000 your interest on that money would be £250 to £290 a year. Criminal when you think of it but I suppose we have to consider interest rates were much higher 8 to 10 years ago and there were fewer credit card companies on the market.

Today the low interest rates that we are experiencing have spurned hundreds of loan and credit card companies cashing in on the cheap cost of borrowing. To get approved for a loan or a credit card nowadays has never been easier. With the advent of the internet you can get approved for a loan or credit card in 10 minutes. So we all have a few 0%, low interest rate credit cards in our bags and wallets but lets find out a bit more about the sting in the tail of these cards.

1. Monthly Repayments:
Well done if you pay your bill off each month in full. Like most of us we only pay off the minimum monthly repayment; this is usually a % of the outstanding balance or no less that £5. Some credit cards will set the minimum repayment on a card at such a low amount that you inevitably end up paying the interest and nothing else. When this happens you end up with a compound interest scenario. Beware you could end up paying off a £2,000 loan for the next 20 years.

2. Credit Card repayment protection (CCRP):
Credit Card companies make a fair amount of money out of you when you use their cards. But wait they want to make some more. Just in case you die or lose your job they will offer you Credit Card protection for a monthly fee. These are usually over priced. Most credit card companies make a fortune out of these policies as most people don't understand how these fees are calculated so don't know there true worth. What most people are buying is the piece of mind.

3. Penalty fees:
If you do not pay on time you will be charged a late payment fine. These vary depending on your credit card company. The best way to prevent this happening is to set up a direct debit. You get charged for exceeding your credit limit. Again this is a very sneaky way for the credit card companies to make money off of us. Most of us will slip up without even knowing it and a charge of £25 can quite easily go unnoticed on our statements. Be diligent and don't give the card companies any excuse to make these charges.

4. Protection Plans:
This is another juicy money maker for the card companies. For an annual fee you will get protection on your card in the event of them being stolen, lost or used fraudulently. Most credit card companies usually don't charge for this and will refund you the money for any fraudulent transactions. I wouldn't suggest getting this.

5. Credit Limit increase:
You had a credit limit of £3,000 and have been diligently paying off your card every month and all of a sudden your new credit card statement says you have a credit limit of £10,000. You probably didn't ask for the increase but hey they gave it to you anyway. Psychologically this makes you think you have more money to spend but it is in fact a sneaky way of getting you to spend more money on your card. If you don't need it ask your credit card company to remove the new limit.

6. Foreign transaction charges It is usually quite convenient to use your credit card abroad on holiday or on a business trip. No need to carry large sums of foreign currency around with you. But wait for it ??.. You will be charge for this privilege (not surprised I am sure). You will be charged a commission depending on the amount you spend abroad which can vary from 3% to 5%.

7. Cash withdrawal charges: Not much new here. If you withdraw money from a cash point using your credit card you will be charged for the privilege. Remember nothing slips through. Card companies can charge in the region 3% of the amount drawn and the bad news as if this isn't bad enough, you won't benefit from any promotional 0% introductory offers that are currently running on your card.

As you can see credit card companies make money from us in more ways than we in most cases are aware of. Be smart and remember all these crucial aspects when using your credit card. You may be one of the few that limits the credit card companies from only making the bare minimum from you.

Grant Marwick is a freelance writer and owner of http://www.only-credit-cards.co.uk where you will find advice and more articles on Low interest Credit Cards and 0% Credit Cards

---

What is Credit Repair and How Can It Help You?

There are millions of consumer credit reports on file from mainly three major reporting bureaus which include Trans Union, Experian, and Equifax. These credit gathering agencies store... Read More

Credit Help For Renters And Others On The Horizon

Sue is a homeowner and pays her mortgage and other bills on time like a good credit consumer. Sue's on-time mortgage payments are reflected in her credit... Read More

Can You Acquire Good Credit Overnight? You Bet

Your credit file may not reflect all your credit accounts. Although most national department store and all-purpose bank credit card accounts will be included in your file,... Read More

Credit Cards: How To Use Them

Credit cards can be a very quick way of getting into even more debt if you do not know how to use them properly. UK debt is... Read More

How to Save Money on Your Credit Cards

Credit card companies make their money on the 85% of us who fail to pay the outstanding balance each month. Even if you are not in a... Read More

Establishing Credit ? What You Need To Know Part 2

In my previous article "Establishing Credit ? What You Need To Know Part 1" I discussed the need for a good credit history and what lenders were... Read More

What is Credit Counselling?

Ever wondered what is Credit Counselling? There are occasions when you might encounter a financial situation that is beyond your scope which is when a session with... Read More

Getting Your Credit Report and Understanding Whats On It

If you intend to apply for a loan, you need to obtain your credit score. Understanding what this score means will allow you to make the loan... Read More

Five Reasons to Repair Your Credit Score - You Can Do It Yourself

There are multiple reasons that tell us why we should have a 700+ Credit Score, but these five facts will definitely give you the big picture and... Read More

Boosting Your Credit Score To Get The Best Credit Card Deal

Making Your Credit Rating Work For YouOne of the basics of getting the most competitive credit card deal in the market is to ensure you have the... Read More

Special Credit Information for Married Couples

If you are married, establish separate credit accounts.Try to finance real estate in just one partner's name to increase your investment financing potential.Avoid joint credit, which limits... Read More

Finding What is on Your Credit Report

A credit report is basically a file about you kept by lenders and banks. As annoying as it may be, it's still perfectly legal for them to... Read More

Its Your Credit - Take Care of It!

Thanks to the Fair and Accurate Credit Act, American consumers can receive a free annual credit report from each of the three major credit bureaus-Experian, TransUnion and... Read More

Credit Card Is Adding The Silver Lining To Your Pocket

In the new millennium plastic money or credit cards has rendered a new zing factor to your pocket. This has not only made you economically more flexible... Read More

What Does Your Credit Score Tell You?

When you apply for a loan or a mortgage, the first thing the lender does is to check your credit score. Based on your credit score, the... Read More

Credit Report ? Watch Out for Parking Tickets

The economic downturn of the last five years has affected millions of Americans, but it has also affected the budgets of states, cities and counties. With limited... Read More

FREE Credit Report Offer - Careful, It Might Carry Hidden Charges

FREE credit checks or free credit reports. What are they all about? Why every second company on the Net is offering you a free credit report? Are... Read More

Finding Reputable Credit Card Companies

You're interested in getting the best credit cards for your family's needs, but you don't want to be cheated. Or you're interested in small business credit cards,... Read More

Dont Dig Your Own Pit

If you want to enjoy your life out of spending, enjoy if you have your own resources and money.But don't enjoy your life by becoming a debtor... Read More

Are 0% Credit Cards Reaching Their End?

Are Credit Card companies starting to feel the pinch? We all know that the Credit Card companies make their money by charging us interest on the money... Read More

How To Repair Your Credit Report

A credit report is run on a buyer when he or she needs to buy something that will take a long-term loan, such as an automobile or... Read More

Our World Of Credit Cards! Which One Is Right For You

There are not many of us who do not have a credit card these days. But, not all of us are as wise in the area of... Read More

How a Credit Card Can Be Your Friend

We have all heard countless stories of people over their heads with credit card debt-maxing out every card they own, then only being able to afford the... Read More

Warning: Free Credit Report Imposter Websites Springing Up on the Web

A recent amendment to the federal Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer credit reporting companies to provide consumers with a free copy... Read More

Learn The Truth About Identity Theft

Identity theft is the fastest growing crime in America, according to a recently released FTC study. Did you know that the term "identity theft" did not exist... Read More

Low Interest Credit Cards Have Many Advantages

When credit cards are used wisely they can be very beneficial to the consumer. A low interest credit card can be exceptionally beneficial. Many people use the... Read More