1. Read the Fine Print: Included in the fine print may be a clause that states the credit card company has the right to periodically review your overall credit and if you have paid late on any credit card, they may raise your interest rate.
2. Beware of fixed rates that aren’t really fixed: A fixed rate card may simply mean that the company needs to inform you in writing at least 15 days prior to the change in rate. Check your statement monthly to be sure your rate is the same as the terms you agreed to when you got the card.
3. Watch your payment due date: Your monthly payments are now often due by a certain time and if it is received after that time, you will be assessed late fees and your interest may be increased due to a late payment. Most companies also offer the ability to chose when your payment is due in order to account for other monthly bills.
4. Paying off your debt could take decades: The credit card companies use to require you to pay 5% of your outstanding balance each month. In recent years they have dropped the minimum payment to as low as 2%. This could mean that even if you do not charge anymore on your card it could take 20 years to pay off your debt.
5. Shorter Grace Periods: Grace periods use to be 30 days, but now many of the credit companies only allow a 21 day window.
6. Bait & Switch: Today you probably get three to four offers a day in the mail that state that you have been pre-approved for a credit card and they may even list what appears to be a competitive interest rate. The small print says that they will review your credit prior to issuing you a card and then once it is reviewed, they may send you a card that has less favorable terms. Review your new cards before you activate them to be sure you got what you were offered.

The bottom line is…
Make sure that you are getting what you expect. Read all of the fine print. Make sure you are paying on time and always pay more than the minimum payment. Check monthly statements to ensure that the rate is correct, that payments have been applied, and the balance is accurate. Use your credit wisely. You may even be able to call and negotiate a lower rate with your credit card company.

And Beware…
Many mortgage companies are advertising to refinance your home and pay off the high interest rate credit cards. A refinance to lower your mortgage rate is wise, but to add your outstanding credit card balance to the loan may not always be in your best interest. Speak to your accountant before doing anything that will be secured by your home.