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Avoiding Credit Card Fees

Author: jalle99 | Posted: 04.10.2008 | Views: 28

Falling into credit card debt is easy, but can be avoided if you understand the APR and credit card fees that the credit card issuers will charge. If you do not pay your card in full every month you will have to pay the APR listed for your account. This can vary from 7.99% to as much as 18% and means your credit card balance does not even have to be above $2,000 and this difference will still mean that you have to pay hundreds of dollars more in interest on the card with a high interest rate.

There are several ways to pay your bill and the safest and cheapest way is to pay online. You avoid relying on the postal office to deliver your payment if you mail it in and if you choose to pay over the phone the card issuer usually charge a fee of $14.95. If you end up paying late you are often charged a late fee.

When you apply for a credit card you get an upper limit on how much you can spend on the card. If the limit is exceeded you also get charged a fee.

All these fees can have a snowball effect. If you get charged more in interest you may be short on cash on the due date and instead of paying online you may choose a check payment, since you know it will take a few more days to clear. One day the card issuer will receive the payment after the due date and the late fee is charged. When the fees and interest are added you may not have much credit line left and perhaps you end up exceeding your credit line resulting in another fee.

Before this gets out of control make sure you read the terms and conditions and understand all the fees the card issuer can impose on you.
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