How to win at credit cards (November 2005)

Choose well. Hunt for cards with consumer-friendly policies. Top 10 credit cards lists bank cards with interest rates and fees at the low end of the spectrum. Also consider cards issued by credit unions. A July 2005 study by the Woodstock Institute, a nonprofit economic development policy group, found that cards issued by credit unions had much lower fees and penalty APRs. To find a credit union for which you might be eligible, visit the Credit Union National Association Web site at www.creditunion.coop or call 800-358-5710.

Scope out the offer. Scan the Schumer box, named for Sen. Charles Schumer, D-N.Y., who sponsored a law mandating disclosure of all rates in a type size that customers can read. Pay attention to notices you receive from your card issuer. If you use your card after receiving them, you may be tacitly agreeing to new terms, even if you claim you never saw the notice.

Negotiate better terms. If your card issuer hits you with a late fee or a rate hike, ask for a waiver. The better your credit score, the more leverage you have, says Scott Bilker, author of “Talk Your Way Out of Credit Card Debt.” “Even if your score is a little below average, you’re still going to spend money and they would rather have it be on their card than a competitor’s,” he says. If you can’t get a better deal now, you can improve your credit score over time by making on-time payments and by not increasing your balance. You can ask for a lower rate later.

Pay on time. Mail your payment as soon as you receive your bill or set up direct online payment arrangements with each card issuer, suggests Curtis Arnold, founder of CardRatings.com. “Even when you’re paying electronically,” he says, “some issuers may take two or three days to post payment to your account, so it’s wise to go online to authorize your payment at least that far in advance of the due date to play it safe.”

Complain. First register a complaint with your state attorney general. (Contact information is available at www.naag.org.) Also lodge a complaint with the Office of the Comptroller of the Currency, at www.occ.gov or 800-613-6743. If the OCC doesn’t regulate the card issuer, it will help you find the agency that does.

 

What did you think of this article?

Liked
Disliked
No Opinion