Pitfalls of the Credit Industry

The credit industry if rife with pitfalls. If you have ever owned a credit card you probably already have learned this the hard way. If you have not owned a credit card previously you should definitely learn all you can about these convenient little suckers (literally) before you commit to any contract.

While not all credit cards are the same many do have similar things in common. For instance they will all charge you interest on your purchases. The only difference there is the amount of interest and how long after you make your purchase that you begin getting charged the interest.

Most people assume that they will not be charged interest for at least a month. This is called the grace period. The thing is that not all credit cards have the same length of grace period. Some companies have 15-day grace periods and others have none at all. This is the kind of thing that you need to find out before you ever make a charge on your card.

When you apply for a credit card you may be offered a lower interest rate. This "introductory rate," as it is called, is most likely only temporary. Once you have owned the card for a few months your interest rate will go up substantially. And the thing is that credit card companies can change their interest rates whenever they feel like it. Did you know that? It's true.

There is a clause in most credit card contracts that allow for the lender to up their interest rates at any time as long as they give you 15 days notice. No matter what rate is quoted in your contract they have this right.

One of the common myths people succumb to when using their credit card is the belief that paying of your balance every month is a good thing. Well, surprise, it's not. People who do not carry a balance on their cards are considered to be "deadbeats/" That's right the responsible, conscientious people are the bad guys. Creditors don't like them because by paying off their balance all of the time they are not letting the lenders make any money off of them. The interest is why they give you credit in the first place, that is their bread and butter. If you were not paying interest why would they want to bother with you?

If you are a deadbeat there is a better chance of your credit card company raising your interest rate or even eliminating your grace period. You might even begin to be charged annual fees for your card. Credit is not free after all.

Credit cards are a great tool to have at your disposal. They can help you get out of a jam quickly and easily, but don't let yourself get carried away by the convenience that they offer. Try to keep your credit card spending to a minimum and you will find in the end you are much better off.

Martin Lukac, represents, #1 Loans USA, a finance web-company specializing in real estate/mortgage market. We specialize in daily updates, rate predictions, mortgage rates and more: http://www.1LoansUSA.com

---

Balance Transfers Introduction

Credit card balance transfer involves using a credit... Read More

What You Need to Know About Interest Rates

For all people shop around for the best rate, there... Read More

Teaching Students To Keep Out Of Credit Card Debt - The Parents Role

Parents have the full responsibility for their children and their... Read More

Bailiffs & Council Tax - Knowing What To Do

This article is about bailiffs who may call trying to... Read More

Credit Cards - A Blessing or a Curse?

Owning a credit card can be quite an advantage. Whether... Read More

Credit Help for Real Estate Financing: Five Categories of Your Credit Score

1. Payment History -- 35%The number of accounts paid as... Read More

My Student Credit Card Adventure

And some practical advice too!My first credit card?I remember my... Read More

Credit Card Companies Are Out for Your Money

You're probably thinking "Tell me something I don't know" but... Read More

How To Read Your Credit Report

The Fair and Accurate Credit Transactions Act, signed into law... Read More

Credit and Its Cost

What is Credit? Credit is money granted by a lender... Read More

Credit Report Secrets: Do You Know What They Reveal?

If you've ever applied for a credit card or loan,... Read More

Minimum Credit Card Payments to Rise

For years, major credit card companies have allowed cardholders to... Read More

Credit Reports Inside and Out

The Credit Report is like your scorecard in the lending... Read More

Can Credit Search Entries Affect Your Ability to get Approved for a New Loan in the UK?

About Search Entries:Every time a lender checks your credit history... Read More

Credit Card Benefits and Drawbacks

Credit cards have both benefits and drawbacks. It is wise... Read More

Stop Struggling Because Of Poor Credit And Improve Credit Rating Now

Did you apply for a personal loan only to be... Read More

Credit Report Disaster Through Mistaken Identity

I've got some very important info I want you to... Read More

What Does Your Credit Say About You?

A credit report is more than just a snapshot of... Read More

What Are The Most Common Credit Card Mistakes?

Now in a world with so many easy to get... Read More

Credit Report And Correction Techniques

The three major credit bureaus, Experian, Equifax and Trans Union... Read More

To Repair Credit Is No longer Satisfactory - Learn How To Earn A Millionaires Credit In 30 Days...

To repair your bad credit does not necessarily mean that... Read More

How to Evaluate and Raise Your Credit Score

Why do some people get offers for pre-approved credit cards... Read More

Protect Yourself Against Identity Theft

Identity theft is when someone uses, without permission, your personal... Read More

Guide to Credit Terms

Listed below is a useful guide to credit card terms.... Read More

Preventing Credit Card Mess

Credit card debts problem is extremely common today. It is... Read More

Credit Cards and How To Choose Them:

It may seem like a simple question but its important... Read More

Debit Card vs. Credit Card, What Are The Differences ?

Ah, the "good old days". If you are a baby... Read More

Building A Credit Report Lenders Will Love You For

Will lenders really love you for having a good credit... Read More

Making Sense of Credit Card Fees

In addition to the APR (annual percentage rate) and the... Read More

Minimize your Risk for Identity Theft

Identity theft is the fastest growing crime in America. According... Read More

0% Credit Cards

These days, credit cards in the UK are competing with... Read More

Legislators Ponder New Credit Protection Laws

Legislators in Washington, D.C. are considering several credit-related consumer protections... Read More

Good Credit is King, When Qualifying for Mortgage Programs

If you want to purchase a new home or refinance... Read More