What Credit Card Companies Never Disclose To You
Feeling dizzy after watching your credit card bill even after normal spending in the billing cycle? Reason for this increased bill is not paying the attention on the terms and conditions mentioned on the documents while signing up for it. Though you freely enjoy shopping by swiping your credit card till the credit card limit gets over and pay the minimum balance before the end of the month, you often miss the current interest rate charged. So be careful while doing any type of transaction with your credit card companies.
Mentioned below are the important things to lookout (and you should do) before buying any credit card because credit card companies often hide:
The Changing Interest Rates:
Attracting customers with exciting offers (for limited period) is what every credit card company does. These offers include, low interest rate for a certain period time, extended time for paying the minimum balance, increased credit for higher amount purchasing etc. But what they don’t disclose is how these offers would change after the limited period is finished i.e. how much interest rate would be charged, minimum balance to paid, credit limit etc. So it’s must for every consumer to pay minute attention on the fine print of your credit card document.
Many a times, these companies bring in such a deal that customer can pay the credit card bill in parts of 6 to 12 months with a minimum interest of 1.5%. This makes consumer greedy and they end up buying expensive items on credit by the time the offer closes, they realize that they’re surcharged with hefty interest rates.
Foreign Transaction Fees:
While travelling abroad, it’s a wise idea to carry credit card instead of cash. In countries where US dollars are not widely accepted, the companies charge foreign transaction fees when you move out of country. So it’s always recommended to carry your normal credit after checking following things:
- Currency conversion fees on every purchase made out of native country.
- Convenience charges for using the card outside
- Additional fees on total purchases made outside the country
Note: Visa and MasterCard levy standard 1% charge on shopping done abroad.
Bargaining Is Possible On Interest Rates:
Another thing which companies hide from customer is interest rates can be bargained. Most often people don’t realize that credit card companies charge 2-3% interest every month, which becomes 24-36% annually. Meaning – if you keep balance on credit card for 5 years, the amount to be paid would be four times of the buying cost. Therefore, it is advisable to pay the balance as early as possible. While paying the balance, you can always bargain with your bank. Normally, banks in India offer 30% of money to the recovery agents and such people are always given attractive benefits than the customers who frequently fail to pay the dues.
Many credit card offering companies charge you for:
- Yearly renewal
- Transaction charges
- Processing fees at petrol pumps
So read these things too before buying any credit card.