Consumers should be vigilant in dealing with credit card rates, knowing that they are the ones that are greatly affected every time the rate increases.
Cardholders are airing many complaints against high interest rates that are being charged by credit card issuers.
It is common to credit card issuers to increase credit card rate anytime in order to protect their interest. Actually, credit card issuers are only given fifteen days to provide notice before making an increase.
When the interest rate of cardholders increases, they are given an opt-out allowance to reject the rate change. If a cardholder chooses to opt-out, the issuer will close his account and he can continue paying his balance at lower interest rate. Upon full payment of the balance, the card cannot be used anymore because it is already closed.
Other than applying personal measures in facing this credit card concern, several other measures can be done in order to properly address the issue and get help.
Getting the attention of authorities is a good move in dealing with credit card rates.
Capping, which is putting a ceiling on interest rates have been debated in the US for so long, but failed.
On the other hand, the 2009 Credit Card Act emphasizes more on the consumer’s protection over the unwarranted increases of fees and all other frauds related with credit cards.
However, the law has more preference in placing a cap not on the interest rates, but on the consumer’s protection against deceptive, complicated and unfair credit card agreements.
With the overwhelming complaints from consumers over usurious credit card rates, consumers must also be willing to make the first move.
Consumers can resort to paying their balance fully on time to avoid being charged with interest.
It is when cardholders are unable to pay the balance due that interest fee is charged. In addition, when they chose only to pay the minimum or forwarded any balance on their credit cards. Oftentimes, the interest fees are exorbitant.
Other Practical Ways to Deal with Credit Card Rate
With credit card rates, the consumer’s concern is to deal with high rates.
- If you are not capable of paying the full balance every month, try to manage your credit card debt with the purpose of eliminating it, and refrain from accumulating more debt.
- Transferring balances from high interest credit cards to a new credit card with lower interest rate will work well. However, you cannot use balance transfer for several times, because you will be facing another debt trap.
- Use the right of choice before signing for a new credit card. Take time to conduct a search, make comparisons and understanding fine prints of every credit card offers. In this way, you have the firsthand opportunity in dealing with credit card rates.
- Save money before charging huge amount on your credit card that will serve as your safety net. With the saved amount, you are more confident that you will be able to pay the charges you are going to make.
With all the possible ways to deal with credit card rates increase, consumers should be responsible in choosing the best way to apply that is applicable to their own predicaments.