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In the United States, we love our credit cards. Almost everyone has at least one and most people rack up thousands of dollars in debt after just a few years. However, not all of that debt comes from overspending - a lot of it is the result of a multitude of credit card fees. There are literally dozens of different fees that credit card companies have at their disposal, some of which seem downright unfair. It’s important to know the types of fees you could responsible for and how to avoid them. Here’s a look at some common questions about credit card fees and what you can do about them:
Questions about Fees
Is it really fair to be charged a $39 fee just because I was a day or two late making a payment?
Whether it’s fair or not is probably debatable, but hitting you with an expensive late fee is within a bank’s power. When you fail to make payments on your debt, the late fee is a reminder to get your card paid, albeit an outrageously expensive one. If you’re only a day or two late, you could try calling your lender and letting them know that you’ll be closing the account if they don’t rescind the fee. Most will actually let you off the hook, at least the first time.
I need a credit card for special occasions, but plan on paying the card off every month. What card is best for this situation and avoiding hidden fees?
Since you’re planning on paying off your balance each month, interest rate shouldn’t be your biggest concern. What you should be aware of is the period between your purchases and when the interest rate is applied to them. As long as you can pay off your debt before interest is applied, you should be able to avoid high interest rates and any types of fees.
I recently received an offer for a low-rate credit card, but it has an annual fee. Is this the only way to get a card with a low rate?
Absolutely not. Don’t settle on a low-rate credit card if you’re forced to pay an annual fee, it’s simply a waste of money. If you’re having trouble getting approved for a low-rate card without a fee, work on bringing your credit score up and make sure there are no mistakes on your credit report. Find the right card and apply once, multiple inquiries can hurt your score.
If I have a closed account, can the credit card company continue charging over the limit fees on my outstanding balance?
Since you can’t actually close an account with an outstanding balance, only stop it from being used for any new purchases, lenders can continue to charge you those over the limit fees. In fact, if you do close your account from new purchases, your credit card company will probably milk you for every charge they can before your debt is completely paid off.
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