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Credit Card Companies Poised to Keep You Hooked
Hooked by a Hooker
The Hooker is your Mastercard, Visa, American Express, or the many others. The Hooked is you and me and us or them.
While the Obama administration passed new credit card reform last year to keep rates on cards fixed for one year unless the client fails in their monthly payment, all the major credit card companies seek to continue their grasp of income using new tactics:
- Inactivity Fees - meaning, if you do not use your card every month for a certain amount they set, you will be slammed with a $20 inactivity fee or more.
- Transferring your total balance to a 0% interest account could cost you hundreds of dollars just to do it, it use to be free in order to get you to switch companies.
- You might sign up for a fixed % rate, which is low, once hooked, a month later the company will switch it to a variable rate card with an annual rate of up to 28%
- Higher late fees. Use to be a surcharge of $20, now most companies slam you with a $40 or more late fee.
- Paying off your balance will cost you much more also, depending on the balance and if you pay it off, it can hurt your credit card score.
Most of these new methods will start happening in February 2010. The best advice is to maintain a low balance, use it a little every month for small amounts and pay on time. Read any boring card notices sent to you about changes to your account. While there is little you can actually do about it, at least you will be aware of the coming pain!