Watch your credit card rates
December 10, 2008
Many people are suddenly discovering that the terms on their credit cards are changing, and you shouldn’t assume it’s only happening to “bad” consumers.
More and more credit card companies are increasing their interest rates, upping the amount of the minimum monthly payment due and increasing fees. This is being done rather arbitrarily. Customers who have always made their payments on time and in full are seeing these increases too.
Unfortunately there’s nothing you can do to stop the increases, but you can take steps to make sure you aren’t blindsided by the changes that could be coming your way.
First and foremost, open every piece of mail you get from your creditors. Your credit card company will send a notice informing you of the increase. However, many people see mail other than their monthly statement, assume it’s junk mail and toss it in the trash. Read everything.
Second, find out if there is an “opt out” clause for the higher rates. For instance, Citibank gives consumers the option to keep their card and take the higher rate, or opt out of the higher rate and use the card at the current interest rate until the card’s expiration date. At that time the card will be canceled.
Finally, pay down your credit card balances and try not to add any new charges.
In the current economic climate, a good offense is the best defense!
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