Free Articles  >>  Business And Finance >>  Page 3257  >> 

Understanding Credit Card Fine Print

While credit card fine print is notoriously dense and difficult to read, it is legally binding, and it is important that you read and understand this fine print before you accept a credit card which may have extremely onerous terms.

The first part of the credit card offer you should read is known as a Schumer box. This is a table with easily read and understood information about rates, fees and penalties. This box includes annual fee, annual percentage rate (APR) for purchases, APR for other purposes, such as balance transfer and cash advances, grace period for purchases, finance calculation method, and transaction fees. All credit cards must provide a Schumer box, all following the same format.

There are several other things you should watch for in fine print. One of the most onerous is that if you are reported as delinquent on any other account, with any creditor, this creditor can raise your APR, in what as known as "universal default."

You should also note whether "disputes on the account are subject to binding arbitration," which would mean that you have no legal recourse against the card issuer, who selects and pays the arbitrator.

Other onerous clauses include lumping balance transfer fees in with purchases, and charging interest on them as if they were purchases, and splitting APR between purchases and cash advancesand applying your payments only to the transactions with lower interest rates, thus charging you more over time.

You should also beware "fixed rate" credit cards on which the APR rises automatically on your entire balance if you go over the limit.

Double-billing cycles, or two-billing cycles, are another common way card issuers overcharge cardholders; this practice means that the interest is calculated on the balance over the two prior months, instead of your average daily balance over the previous one month.

Understanding the fine print, and the fees, on your credit card can save you not only a lot of grief, but a considerable amount of money, as well.

Card issuers use the fine print of their card agreements very well, in their own interest. They spell out conditions that most people would not agree to if they were aware of them; the issuers count on people not reading these agreements. The fact is, however, if you agree to them by accepting and using the card, you are bound by the agreements, whether you read them or not.

The most important thing to understand, of course, is that card issuers are in business to make a profit, and it is the cardholder's responsibility to thoroughly investigate all offers.

About Author Bruce J Kavich :

the creditagogo team, <a href="" target="_blank"></a> providing the best credit cards and personal finance information available.

Article Source:
Article Url:

Article Added on Sunday, May 10, 2009
Other Articles by Bruce J Kavich

Five Advantages Of Using A Credit Card While Travelling
If you travel much, you probably understand how important having a credit card can be to a smooth trip. If you're not a frequent traveler, or have not used a credit card a great deal in your travel, the following list of advantages may be enlightening to you and help you determine whether a cards use might be a good addition to your travel necessities. 1. Credit cards make it easy to track spending. Even if you're not keeping receipts for an expense reimbursement, it is a good idea to keep...

Publishers / Webmasters
Article ID: 133987
DELINK URL from Authors Bio
REMOVE Article
Tell A Friend
Leave A Comment!
Download this article in PDF
Report Article!
Search through all the articles:

204 Users Online!!
Related Articles:
Latest Articles:
Business And Finance >> Top 50 Articles on Business And Finance
Category - >
Advertising Advice Affiliate Programs Automobiles
Be Your Own Mentor Careers Communication Consumers
CopyWriting Crime Domain Names DoT com Entrepreneur Corner
Ebooks Ecommerce Education Email
Entertainment Environment Family Finance And Business
Food & Drink Gardening Health & Fitness Hobbies
Home Business Home Improvement Humour House Holds
Internet And Computers Kiddos and Teens Legal Matters Mail Order
Management Marketing Marriage MetaPhysical
Motivational MultiMedia Multi Level Marketing NewsLetters
Pets Psychology Religion Parenting
Politics Sales Science Search Engine Optimization
Site Promotion Sports Technology Travel
Web Development Web Hosting WeightLoss Women's Corner
Writing Miscellaneous Articles Real Estate Arts And Crafts

Disclaimer: The information presented and opinions expressed in the articles are those of the authors
and do not necessarily represent the views of and/or its owners.

Copyright AwareINDIA. All rights reserved || Privacy Policy || Terms Of Use || Author Guidelines || Free Articles
FAQs Link To Us || Submit An Article || Free Downloads|| Contact Us || Site Map  || Advertise with Us ||
Click here for Special webhosting packages for visitors of this website only!
Vastu Shastra

Shared Linux Hosting Provided By AwareIndia

Company IDS