The Sneaky Ways Creditors Get You to Pay More on Your Credit Cards

| Posted: 11-03-2008 | Comments: 0 | Views: 17 | Rating: (58)

(?)

Increasing your credit card interest rates

Do you walk out to your mailbox every month, snatch up your bills and wonder: ‘How am I ever going to be able to pay all this debt off?’ It’s a thought that rushes through the minds on millions of Americans every year as they struggle to try and make payments on debt that seems almost insurmountable. However, it’s important to know that credit companies are in the business of making money and will do just about anything to make money.

Therefore, you should be careful for several things, the most important being the use of interest rates on credit cards and most other forms of credit. Interest rates are actually quite easy to understand but many people lose track of exactly what their interest rate is and eventually succumb to an overwhelming rate.

Most creditors will start your interest rate off low, even as low as zero percent. At that rate, you can use your credit however you please and the creditor doesn’t see a dime. After a certain predetermined amount of time, though, the interest rate balloons and consumers are required to start paying the creditors every month just for carrying a balance.

Before you take any form of credit, find out how the interest rate works, what it will be and if it will be fixed and vary over the course of a year. Once you understand how this works, you’ll be able to avoid paying unnecessary fees just for using credit.

Understating the importance of minimum monthly payments

Minimum monthly payments are another way that different creditors get you to pay more on your credit cards. In theory, the minimum monthly payment is a set amount that allows you to pay off the creditor—not usually the balance—every month.

Most people believe that when they pay the minimum monthly amount, they’re paying the lowest amount the credit card company needs that month. But in reality, they’re usually paying off the amount the credit card company needs to make in order to turn a profit off your account. In many cases, you won’t even be lowering your overall balance at all as the credit card company’s interest rate will come right behind your minimum monthly payment and boost your balance up again.

It’s important to be mindful of this and do what you can to make payments above and beyond the minimum payment required. This is the only way you’ll be able to pay down your debt and limit the amount of money you throw towards your creditors at the same time.

Overcharging you for late credit card payments

Like minimum monthly payments, the penalty you are charged for making a credit card payment late makes sense. After all, how will your credit card company make any money if all the customers it lends money to simply don’t decide to make payments on time? However, many credit card companies overcharge you for making late payments, which makes it even more important for you to make all payments promptly and on time.

In addition to the fees you already accumulate with your interest rate, late penalties are one fee that simply doesn’t make sense. It’s a way for creditors to force you to make payments on time and charge you heavily if you don’t. If you’re not already careful about not skipping payments, consider creating a system using a calendar that ensures that you don’t miss monthly payments. You’ll be glad you did and you’ll be a whole lot less frustrated by your creditors.

Rate this Article:

Current: 0 / 5 stars - 0 vote(s).

Article Tags: Debt Consolidation Loans, Debt Help, Credit Card Debt, Debt Consolidation, Debt Consolidation Services, Debt Consolidation Program, Consolidate Credit Card Debt, Student Loan Debt Consolidation, Consolidation Loans, Credit Card Bill Consolidation

Article Source: http://www.articlesbase.com/debt-consolidation-articles/the-sneaky-ways-creditors-get-you-to-pay-more-on-your-credit-cards-356641.html

Print article

Send to friend

Publish this Article

Author feedback

About the Author:

Dometri Quick is the development director at DebtConsolidationSupport.com. You can find more articles for helping you eliminate credit card debt at http://www.debtconsolidationsupport.com.

Submitting articles has become one of the most popular means of generating quality backlinks and targeted traffic to your website. Join us today - It's Free!

Article Comments

Add new Comment

Deadly Debt Elimination Traps: Avoid These Credit Killers at All Costs
By: Dometri Quick | 11/03/2008 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

5 Secrets Creditors Don’t Want You to Know About Eliminating Debt
By: Dometri Quick | 11/03/2008 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

How to Find the Most Effective Debt Consolidation Program for You
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

6 Simple Steps for Eliminating Credit Card Debt in 2 Years or Less
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

Secrets to Negotiating a Debt Settlement With Your Credit Card Company
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

How to Determine Whether Debt Consolidation is Right for you
By: Dometri Quick | 11/12/2007 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

4 Fatal Mistakes to Avoid When Applying for Debt Consolidation Loans
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

How Almost Anyone Can Secure a Low-interest Loan With Bad Credit
By: Dometri Quick | 11/12/2007 | Debt Consolidation
Debt Consolidation Articles - Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.

Got a Question? Ask.

Ask the community a question about this article:

Q&A Powered by:

Latest Debt Consolidation Articles

How to Encounter Debts With Debt Consolidation Loans
By: Minkesh Sood | 10/10/2008
To overcome debts is wish of every individual but in many situation people do not know how to get out of it and omit there debts. A Debt Consolidation Loan will help you in encountering your debts and from able to make your finances improved.

Ways to Get Home Loan Refinancing Quotes
By: Steven Walters | 08/10/2008
Home loan refinancing is a huge decision and getting a good refinancing loan can save you tens of thousands of dollars over the life of your mortgage. Find out easy ways to refinance your home loan online.

Debt Consolidation Loan : Advantages That You Should not Miss
By: Julian Lim | 07/10/2008
Debt consolidation loan has its share of advantages as well as disadvantages. However, for many people, the benefits of debt consolidation loan clearly outweigh the disadvantages. Some of this loan’s benefits that you can enjoy include low interest rates, easier monthly payment and reduction of stress and worries.

A World in Debt
By: Ricardo Reeves | 07/10/2008
The world's economy is in a state of flux. In such an environment it is imperative to get your finances in order.

Christian Debt Consolidation
By: Karl Caprio | 07/10/2008
A leading debt consolidation company offers Christian debt consolidation and student debt consolidation loans and services along with credit card debt consolidation, reduction and settlement programs to consolidate your debt in a single low interest loan.

Debt Consolidation Loan
By: Karl Caprio | 07/10/2008
Debt consolidation and credit card debt settlement services in USA including fast and free quote to reduce credit card debt, bad credit or bankruptcy loans consolidation, consolidate bad debts and lower the interest rates with only single monthly payment for students & soldiers also.

Freeing yourself From a Cloud of Debt
By: Ricardo Reeves | 06/10/2008
Fighting the credit crunch: important points to consider when assessing your debt management needs. Help turn your debt mountain in to the molehill of your dreams.

The Way to File Bankruptcy/insolvency
By: Minkesh Sood | 06/10/2008
Applying for insolvency in the U K can be a scary experience but not an impossible task. For filing bankruptcy individual just need to do your homework properly.

More from Dometri Quick

4 Fatal Mistakes to Avoid When Applying for Debt Consolidation Loans
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Worried about sending your personal information to a debt consolidation company? Some helpful tips to help you avoid making a BIG mistake.

Secrets to Negotiating a Debt Settlement With Your Credit Card Company
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Dealing with your credit card company doesn’t have to be painful. Here’s a few ways to deal with them without giving yourself a headache.

6 Simple Steps for Eliminating Credit Card Debt in 2 Years or Less
By: Dometri Quick | 14/03/2008 | Debt Consolidation
When it comes to debt, time really is money. Find out how to eliminate yours quickly and efficiently.

How to Find the Most Effective Debt Consolidation Program for You
By: Dometri Quick | 14/03/2008 | Debt Consolidation
Everyone wants a few more dollars in their pocket every month. Consolidate your debt now and find out how you can do it.

5 Secrets Creditors Don’t Want You to Know About Eliminating Debt
By: Dometri Quick | 11/03/2008 | Debt Consolidation
Creditors make money by keeping you in debt. Avoid these secrets that they use to try and keep you there forever and start eliminating it today.

Deadly Debt Elimination Traps: Avoid These Credit Killers at All Costs
By: Dometri Quick | 11/03/2008 | Debt Consolidation
Debt consolidation? Debt settlement? Bankruptcy? They can all hurt your credit score, but which way is the best way to eliminate debt?

The Single Most Important Step You Must Take to Eliminate Debt Fast
By: Dometri Quick | 11/03/2008 | Debt Consolidation
Understanding and taking the right approach to eliminating debt is the most important step you need to take. Learn that now and get started.

Warning! the Hidden Truth About Dishonest Debt Consolidation Companies
By: Dometri Quick | 11/03/2008 | Debt Consolidation
Did you know that you could be hurting yourself by consolidating your debt with the wrong company? Here’s how you could be suffering.

Article Categories

Article Marketing

Article Notepad

Stop Duplicate Content

Term Papers

Need Help?

Sign up for our email newsletter

Receive updates, enter your email below

Use of this web site constitutes acceptance of the Terms Of Use and Privacy Policy | User published content is licensed under a Creative Commons License.
Copyright © 2005-2008 Free Articles by ArticlesBase.com, All rights reserved. (4.25, 17)

The Sneaky Ways Creditors Get You to Pay More on Your Credit Cards

Article Comments

Related Articles

Got a Question? Ask.

Latest Debt Consolidation Articles

More from Dometri Quick

Need Help?

Site Links

Webmasters

Business Info

Sign up for our email newsletter