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Credit Card Applications: Read the Fine Print

By: Martha Krahenbuhl

The statistics shows that most cardholders rarely read credit applications thoroughly. Even those, who tend to look applications through, can hardly get the idea. Cardholders often say: reading the fine print in credit card applications is like guessing the riddles of the Sphinx. Though credit agreements are written in English, they make no sense. But look, skipping details in your credit card agreement can cost you a pretty penny!
The problem is, credit card agreements are written in legalese. Credit card companies admit this fact, but they are not willing to change something. Credit business is all about hidden icebergs. You may say, creditors use legalese intentionally in credit applications in order to earn money on our mistakes. Yes, it is true. Be smarter! Protect yourself from foolish mistakes – make out your credit card agreement!
It must be mentioned, lots of cardholders do not read the fine print. Signing for a new credit card, many people are tempted with those low or even zero interest rates, and alluring rewards. However, there is no guarantee you will got the promised incentives. Why? Read a credit agreements. All the truth is hidden in the fine print.
The thing is only 30% of credit card owners read the agreements up to the end. You know, information is the power, and once you are aware of the terms and conditions on your plastic card, you are protected against unexpected changes that often cause financial problems.
The first thing to pay attention to is the interest rate. Read your application carefully, learn all the interest rates that apply to purchases, balance transfers, and cash advance. If you are going to obtain a low interest rate card, check whether these low rates are applied only for the introductory period or you will be able to enjoy low interest charges lifetime. Clear up, whether the interest rates on your credit card are fixed or variable. You must be sure that interests on your plastic won’t jump high all of a sudden. Also, pay close attention to penalty rates that hit you every time you are late with payments, or exceed your credit limit, or in case your score has suddenly dropped.
Want to take advantage of balance transfer cards and to reduce your debt? Before signing an agreement, learn what balance transfer fee you will be charged. Make sure that the game is worth the candle. Another thing to pay attention to is a minimum payment that may hike to 4% of the balance. Make certain, that having obtained a balance transfer plastic in order to get rid of debt, you will not face new financial difficulties.
Credit cards fees also play a great role. Credit issuers seldom specify all the fees on this or that plastic, but you will easily find all the expected fees in a credit card agreement. Consider late payment fees and the duration of the grace period. Nowadays, credit companies tend to cut grace periods up to twenty days. That means you should do your best to make necessary payments on time, if you are not going to be charged high penalty fees. It is not so hard to pay the bills on time. Today, you can do it online, if you are short of time. If you are afraid to miss the payment because you do not have enough money at the moment, contact your lender in order to avoid possible problems.

Article Source: http://ezine-articles-planet.com

Martha Krahenbuhl writes about debt, credit deals, credit cards rates, financial failures, and other personal finance related issues.

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