Credit Card Marketing Traps to Avoid

by San Antonio Attorney

Credit card companies have stiffened their requirements shortly after the recent economic crisis. Consumers have made the decision that they did not want to contend with credit card debt. But now that confidence is coming back, many cardholders incurred a higher card balance in June 2012 than in the same month last year.

Mailboxes are filled with card offers once again. Here are some of the things that you should be aware about the credit card marketing traps:

Zero Percent Balance Transfer

In general, balance transfer is an effective way to reduce debt at a quicker rate. But you should be cautious. Firstly, it is possible that your desired amount will not be approved.  Second, advertisements of credit card issuers do not include the balance transfer fee.

But balance transfer fee is stated on the application form. It is probably 3 or 5 percent of the amount you transfer. But if the interest rate of your credit card is high enough, paying the balance transfer fee would be a good option.

Low APR Promises

You will see advertisements with big fonts claiming that they offer the most competitive rate. But the truth is not everybody is eligible for this low rate. In fact, the best rate is just for individuals who have the great credit scores.

If you look at the back page of the application form, you should find the interest policies and a list of fees. You may discover that the interest rate is at most 20.99 percent. Therefore, you could wind up with a greater interest rate than what is advertised.

Lucrative Rewards Program

A common marketing tactic of credit card issuers is offering rewards programs to potential customers. Some may offer 5 percent cash back when you sign up.  But actually you may only get 5 percent cash back on revolving categories. There are rewards programs that require cardholder to meet a certain limit.

 

–  Using credit cards irresponsibly can lead to an excessive credit card debt that is almost impossible to pay off. If you wish to eliminate your credit card debt, filing for bankruptcy could be one of your options. Talk to a Bankruptcy Lawyer San Antonio to find out if you are eligible for a bankruptcy discharge.

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