6 Credit Card Secrets Banks dont tell you
Below is a MRR and PLR article in category Finance -> subcategory Other.
6 Credit Card Secrets Banks Don’t Want You to Know
Discover the hidden truths about credit card practices and learn how to save money by understanding these key details banks often keep under wraps.
1. Interest Backdating
Some card issuers start charging interest from the purchase date rather than when the charge posts to your account, potentially days before they pay the store on your behalf.
Solution: Choose a card issuer that doesn’t backdate interest or always pay your bill in full by the due date.
2. Two-Cycle Billing
This interest calculation method charges two months' worth of interest if you don’t pay off your balance in full, just for missing one month.
Solution: Opt for an issuer that doesn’t use two-cycle billing or consistently pay your full balance.
3. The Right To Setoff
If you have both a deposit account and a credit card at the same bank, the bank might use your deposits to cover credit card delinquencies based on your initial agreement.
Solution: Keep your banking and credit card accounts at separate institutions or avoid missing payments.
4. Fees Are Negotiable
Annual fees can climb to $50 or more, and finance charges can exceed 18%.
Solution: If you’re a valued customer, request a waiver of the annual fee or a lower interest rate. If that doesn’t work, switch to a more affordable card.
5. Retroactive Interest Rate Hikes
Promotional low rates, like 7.9%, revert to much higher rates once the teaser period ends, affecting your existing balance.
Solution: Pay off your full balance before the rate increases or close the account.
6. Shortened Due Dates
While many cards offer a 25-day grace period, some issuers reduce this to 20 days for customers who typically pay in full.
Solution: Request to reinstate the 25-day grace period.
By understanding these practices, you can make savvy decisions and potentially save a lot of money.
Source: Massachusetts Executive Office of Consumer Affairs and Business Regulation
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