By Dr. Kavita
Argue as much as you want to, but there are many secrets about your credit cards that you still do not know. Despite using this plastic money for years together, credit card companies still manage to keep many important facts hidden from the general consumers. So, what are those secrets? Read through this post to find out now.
Rate of interest charged on your credit card
You signed up for your credit card expecting a certain rate of interest to be charged by the credit card company when you put the card in to use. But these rates are not permanent and can be hiked to any level.
The top ten banks that are issuing credit cards are under no obligation to follow the CARD act that limits the hiking of interest rates beyond a certain level. This is because these banks are federally chartered.
You can refuse interest hikes
If your credit card provider decided to hike your interest rates, then you are not under any obligation to pay it. This is because you are protected by the CARD Act. Though the credit card company can charge higher rates and then when you refuse to pay up, they could take stringent measures like hiking the minimum amount to be paid on your credit card bills each month, closing your credit limit or closing your credit card, they still can’t force you to use the card at higher interest rates.
Credit card protection for purchases
This is a benefit that most of the credit card users tend to forget and overlook. Whenever you make purchases with your credit card, you are protected. What does this mean? In case you made a purchase and it did not turn up the way it was meant to be or never was delivered at all, you can claim a refund
Your cards may not work internationally
Most of the credit cards in the US have a magnetic strip in them. But many international locations have credit card reading machines that do not recognize these magnetic strips. Only those cards that have a computer chip may work here.
Before travelling abroad make sure that your cards will be accepted there or else ask your credit card issuer to provide you with an EMV version that chip recognizing credit card reading machines can acknowledge.
The rules for card balance are complicated
There are some cards that offer a great benefit called ‘no spending limit’. A huge number of consumers are using these kinds of cards too. But what these cards do not reveal is though there is no limit on spending; there definitely is a limit to how much balance you can carry forward to next month. When you overshoot this limit, this could reflect badly in your credit report.
Don’t panic about late payments
People think that they will be reported to the credit bureaus if they miss the payment before the end of the grace period, which is usually between 20- 30 days. But the act is that your credit card company cannot report your late payment unless you have not paid for one whole cycle, which is 30 days after the end of grace period.
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