Stay away from your credit limit
Lenders apply credit limits in hope that the consumer will go over their limit. Most consumers do go over their limits and then come to the realization of the consequences of doing so. Once a consumer goes over their limit the lenders reserve the right to up their interest rates as well as their minimum payments. The consumer finds themselves on a new type of payment and interest rates due to one missed or late payment. This is not the only problem the consumer will have to pay late payments, more finance charges and over the limit fees. When the lenders give out their services they are expecting and waiting for the consumer to go over their limit or to be late on a payment. This is when they pounce and make a whole new set of rules in which the consumer has no say. It is all in the fine print that so many of us over look or don’t understand.
The Credit Card Protection Act is supposed to help when it comes to these charges, but lenders have found a legal way to get around this. Going into the agreement consumer usually know the risks but never bank on it happening, but when it does they are hit hard. Some lenders do provide a grace period which allows the consumer a period of time to pay the payment, but this is usually not offered for free. The consumer may have to pay for this which in time will add up and not be very beneficial. Lender can be tricking with their fine print and at times will put conditions on the grace period. It is always wise to read the fine print and understand exactly how all of the charges can affect you.
Your credit used shouldn't be anymore than 20% of the allowed limit
If a consumer finds themselves in this position it is wise to stay within 20% of their previous balances. This will be additional insurance that over limit fees will not be applied. Over limit fees are usually $35.00 dollars, but some lenders reserve the right to charge the consumer again with in a 72 hour period. Credit cards can be convenient but the charges are not worth the usages that the consumers receive. Consumer should do all that can be done to stay within a 20% minimum of the limit. The best way to avoid these charges is to use the credit card for emergency purposes and not on a daily basis. In the times that we live in it seem we may need a credit card every once in a while, but there are other ways to do this. Purchasing a prepaid credit card is a sure way to have a card and not pay outrageous interest and other fees. Prepaid credit cards are the same as a credit card but one is not being charged for having it. This is a great way to have a card if needed without worrying about the fees.