Hidden Credit Card Fees

Credit card debt is one of the main concerns the average American household is faced with today, but before one can make an efforts to reduce credit card debt, it is important to look at some of the ways the credit card companies trick the public into paying more than they should by sticking them with those credit card fees and rates that are covertly hidden within the fine print.

There are many fees that can be found within the credit card terms and conditions, fees such as late fees, overlimit fees, balance transfer fees, and ATM cash advance fees. Yes, these are hidden fees and must read very carefully, but let’s face it; we all know about those tricky fees. Let’s talk about some ways that the credit card companies really trick the average card holder:

Annual Percentage Rate (APR): Teaser Rates and Rate Increases

Granted, the annual percentage rate isn’t necessarily a hidden fee; it is stated right there on the credit card application, sometimes even in mammoth bold numbers. Though, sometimes what is in bold isn’t necessarily the whole picture.

Oftentimes, the credit card solicitations you receive in the mail have attractive 0% APRs or very low APRs marked big and bold on the front of the envelope as well as on the very top of the application letter, but if you read closer in the letter and especially on the back where the details of rates and fees can be found, you may notice that the rate is an introductory rate for a short term and after that term is up, the rate may increase, sometimes as drastically as up to 25%.

It is also important to notice the “Other APRs” section of the details which spells out the APRs for balance transfers, cash advances, and default APRs which are also known to be extremely higher than the introductory rate flashed across the from of the application.

The default APR is one that is frequently overlooked and can in the long run cause those card holders that are trying to reduce credit card debt to instead unintentionally increase their debt. Most credit card applications state that in the attempt that the card holder is late or over the limit, the credit card company has the right to increase the APR on all accounts held through their company. This means that if the card holder is late making a payment, not only can that late payment affect the credit account that was paid late, but it can affect all of the credit accounts that card holder has with that credit card company.

Grace Periods

If credit card companies were magicians, the grace period would be that bunny hiding in the hat. This is one of the trickiest hidden fees that credit card companies have up their sleeve!

The credit card offer will tell you when the grace period for your credit card is. Oftentimes it is anywhere from 20 to 28 days. This is the amount of time you have in between payment due dates. If you read the fine print, however, you may read that the “grace period may vary from one billing cycle to another.” This means, they have the right to change your due date at anytime. This is often how they trick card holders into paying late payments which then can result in them charging a late fee and which then gives them the right to increase your APR (which like I said above, if stated in the fine print, they have the right to do).

Keep a Weary Eye

Even those credit card holders that are responsibly trying to reduce credit card debt can easily be deceived by these tricks because credit card companies go to great lengths to get you to focus your attention on the good and overlook the bad. A good rule of thumb is to remember what your mother always told you; if it looks too good to be true then it probably is too good to be true!