Every credit card has a spending limit associated with it. This limit is decided
by the credit card issuer based on your credit history, financial health and
repayment record. Whenever a credit card holder goes overboard and spends more
than his credit limit, the credit card companies slap an over the limit fees
So, over the limit fees is a penalty to cross your credit limits. The credit
card issuing companies generally add anything between $20 to $40 to your monthly
statement when you jump credit limits. The over the limit fees are generally
mentioned in the terms and conditions that come with the credit card. Since,
not too many of us care about those fine prints, very few know about their credit
limits and even less know that anything such as over the limit fees exists.
It is only when one such ignorant credit card holder goes out on a spending
spree and gets the penalty, he comes to know about existence of any such fees.
When a credit card company finds that a particular credit card holder has crossed
his credit limits it can either decline the purchase or transaction altogether
or approve the purchase and charge an over the limit fees to the credit card
If a person is having exceptionally good relation with the credit card company
and his credit history and repayment terms inspire tremendous confidence to
the credit card issuer they might waive the over the credit limit fees and increase
his credit limits to cover the extra expenditure. However this is particularly
Avoiding over the limit penalty is pretty simple and it only takes few conscious
decisions on the part of credit card holder.
If a credit card holder monitors his spending closely and gets the required
information about the credit limits of a particular credit card, he can easily
stay within spending limits. Many credit card companies do their bit to inform
a credit card holder when he is nearing his credit limit. They regularly send
email alerts to such a customer. Signing up for email alerts from the credit
card issuer will definitely ring the warning bells well in advance. If a credit
card holder sincerely believes his future transactions are going to cross the
credit limits he can get the credit limits raised in advance.
Over the limit credit fees are charged generally due to the negligence and
callousness on the part of credit card holder. Staying within credit limits
is a good financial habit and should be imbibed in the life very early. This
will easily keep over the limit penalty at bay.