It’s a rough time for many credit card borrowers. Interest rates are rising, banks are looking to squeeze extra profit from each account and the industry’s ‘‘grace periods’’ have contracted in very ungraceful ways the past few years.
The November issue of Consumer Reports magazine summarizes many of the new pitfalls for card holders and offers a few tips to navigate this treacherous fiscal landscape.
• Research card offers closely. This is crucial as banks fight for your business. The lowest rate is just one of numerous factors to weigh, including grace periods,
• Consider credit union cards. These financial institutions typically feature lower fees and interest rates, according to a July 2005 survey by the Woodstock Institute cited by the magazine.
• Pay on time. Mail your payment when you get your bill. Late-arriving payments have become a gold mine for banks and a thicket for consumers in recent years. Miss a payment or forget to get it there on time and the banks tend to revel in the fees and penalties they’ll assess you.
• Request a better rate. Many, if not most, banks will lower your rate if you have a good payment history, decent credit score and spend regularly.
• Complain. Calling the card issuer can help if you have a late fee or rate hike on your bill.
• Walk away. The bank wants you to keep borrowing, and they never forget you can take your business elsewhere. You should remember that, too.