WHAT CREDIT CARD COMPANIES DO TO THEIR CUSTOMERS?

Credit card companies are increasing the interest rates on the consumers. Sometimes, they even go to the extent of doubling the interest rates and that too without notice or informing the credit card holder. Credit card holders are complaining that although they have low credit balances they always need to pay a little more than the least amount required, thereby, always pay before the last date to have good credit ratings.

Apparently, credit card holders with low rates and revolving balances are the biggest targets. Even long standing customers are put at risk, especially if they are being charged with low interest rates.

What credit card companies are doing now?

They are slashing the “Lines of credit”.

If you don’t pay your monthly instalment on time then your interest rate will become incredibly high.

Interest rates are on the rise.

What can you do to handle such issues?

First, you will think of terminating your credit card account. This is not the best thing you can do since your credit score will be hurt. There will be a hundred point drops in your credit score, if you close a credit card account. Moreover, your credit history will look shorter which will further damage your credit score.

The best thing you can do is to reduce the usage of the credit card. Don’t spend more that what you can pay off each month. If you’re paying off your entire credit balance each month then you will not have to worry about these increases in the interest rates as they will not affect you. They are definitely offensive, however if you are able to dodge these high interest rates you will not be disturbed by anyone.

Another good option is to pay off your credit bills and throw those cards in the drawer. You can pay using cash or your debit card for your daily purchases. Use your credit cards only for large ticket items or emergencies.

If you get any notice which says that the interest rates on your credit card have increased, call them immediately. Although it is very unlikely that they will roll back the increased rate, you can ask them to transfer you to a different plan where the interest rates are not so high.

Shop around as there are over 5000 “credit card companies” in the US alone.

You can choose to “opt out”. This means that you will not be able to use the credit card any more and pay off your credit balance at the current interest rate. You will not have to pay the entire balance at one shot. Talk to your credit card company before you choose to take up this option. Make notes, write the date next to each note and make sure that you have the full name of the executive you spoke with.

The bottom line is, don’t just sit quite and become miserable later. Take action and make sure that the credit card company does not take you for a ride.