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Almost, every credit card advisor worth his salt will tell you to read fine
prints carefully before deciding on the credit card. Despite all the explaining
this fact is often overlooked. How fine prints can affect the ownership of
credit card? This article takes a look at the murky credit card world. You will
be astonished how, these large sentences in small fonts, asterisks and special
symbols can change the way credit card benefits you. We take a look at how fine
prints can change the three most important benefits viz. 0% intro APR, the
annual fees and credit card spending limits.
1. 0% Intro APR
Ok, the credit card states that it has a 0% intro APR. But what does it
relate to, purchases, balance transfers, cash advance what exactly? Check it
out. And about the length of 0% Intro APR period-- one fine print states
that-- The length of your introductory period will be
either 6 months for purchases and balance transfers or 3 months for balance
transfers, depending on our review of your application and credit history. This
adds a lot of ambiguous element to the APR. Next thing to bother about 0% intro
APR is what defaults will terminate the benefit, for example: If a person makes
a late payment the introductory or special rates terminate instantly and
standard purchase rate apply. If you default twice the APR rate increases to
18.5% and if you default thrice, the APR will jump to 24.99% and so will be the
interest on cash advances. Now do you see the 0% Intro APR hitting below the
belt! So read the fine print always and get the facts clear about credit
card straight from the issuing company.
2. Annual Fees
You must've seen various credit card offers stating -- No, annual Fees*. Some
people straightaway make the conclusion that the credit card won't cause them a
penny for ownership-- and that too for life. Are the credit card companies that
naive? Will they let you go so easily? Didn't you see the * after No,
annual Fees. Yes, that asterisk (*) could spoil the honeymoon of No annual fee
for you. It could lead to a page where written in very small fonts are lines
that could mean -- The annual fees for the credit card will be waived for the
first year. Thereafter, the annual fee will be $45 for the Basic Card. And If
you default on repayments for a certain period the Annual fees will apply
instantly. Any waivers, or benefits will cease instantly! So, take extra care of
those asterisks.
3. Credit card spending limit
A credit card with no preset spending limit can excite a consumer so much
that he runs straight to the credit card company to get the card. But, buried
somewhere in fine prints he will find the statement-- The credit card has
no preset spending limit which gives you purchasing power that adjusts with your
use of the Card. No preset spending limit does not mean unlimited spending. Your
purchases are approved based on a variety of factors, including current spending
patterns, your payment history, credit history, and financial resources known to
us. So, things change suddenly. Credit card companies will allow you to
overspend even beyond the credit limits and happily slap you with a over-the
limit credit fees. So, even if you spend 1 dollar above your spending limit you
could be slapped as much as $30 for crossing your credit limits. Strange but
true, borrowing 1 dollar will cost you $30 extra.
Many things can be said about fine prints, every fine prints tries to apply
certain restrictions, or explain a controversial point which credit card
companies shy away from writing in bold. These fine prints weigh heavily towards
the credit card company, and if a consumer doesn't read it carefully he falls
into the trap.
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