Americans for Fairness in Lending

The Watchdog: Credit Card Cautions: AFFIL's "Common Credit Card Tricks and Traps" published as resource in Fort Worth Star-Telegram.

Full Text: 

Faced with mounting complaints about abuses by credit card companies, Congress is studying proposed legislation and the Federal Reserve is looking at new consumer-protection measures. 

Congress could vote as early as September on several bills, including one called the Credit Cardholders’ Bill of Rights. The Fed is expected to act this year.

But until any changes come, it’s wise to watch out for pitfalls on your own. Americans for Fairness in Lending says you should:

• Make sure your credit card bill is due the same date each month.
• Watch for early due dates that make the bill due a few days after you receive it.
• Watch for weekend due dates because if your payment arrives the following Monday, you will probably face a late fee.
• Never go over your credit limit because if you do, you might face an extra charge and your interest rate could go up.
• Avoid missing a payment on one card; it might affect the interest rate on an unrelated card.
• Never assume you get to keep the low teaser rate for the entire promotional period.
• Understand that if your card offers two rates (one for purchases and one for cash balances), your payments will always go toward paying off the lower-rate charges before the higher ones.
• Avoid add-on charges like "credit protection" because the fees are probably more than the minimum payment the service would cover if you became sick or lost your job.

— Dave Lieber