Anomalies Of Credit Cards

Friday, July 9, 2010, 12:57 AM | 1 Comment

Online dictionaries define anomaly as “Deviation or departure from the normal or common order, form, or rule.” Or “One that is peculiar, irregular, abnormal, or difficult to classify.” With the new CARD Act in place now, hopefully there will be some protection provided to the consumers. However, we as consumers have also the responsibility of protecting ourselves and our families when we use our dearest and most precious credit cards that we cannot live without.

The following are some general tips that you should be aware of when you use your credit card – the “before” and “after” situations:

Gas station trap

Paying at an automated gas pump can tie up money on your credit line. Let’s say your gas bill is $25. Some gas pumps block off $50 on your card to protect themselves against fraud. Believe it or not, the credit hold stays on your account for 2 to 8 days before that part of your credit is unfrozen. To avoid this, have the attendant ring up the purchase.

Billing errors alert

Report credit card billing errors in writing within the time-period that appears on your statement. Send the letter by certified mail, request return receipts, for proof that you responded properly.

Big mistakes

An increasing number of credit card holders are not signing their credit cards in the mistaken belief this helps fight credit fraud. The thieves can sign it themselves and might use it as identification for all kinds of purposes, since the signatures will obviously match. If you are still hesitant to sign it, then instead of your signature, write “See ID” with the pen provided by your bank.

Fine print

With the new CARD Act, hopefully traditional fine-print will be no more. Everything will be written clearly and in big print. There are certain fine prints that will not go away. For example, misleading retail ads might read “no interest is due” for something like 6 months. But if the bill is not paid by the due date, an exorbitant interest rate may be charged. So, read the print very carefully before accepting a supposedly no-interest offer.

Be careful when debt consolidators approach you

In general, don’t enter a loan-consolidation agreement that stretches out the term of your borrowing. However, if you can obtain a reduction in the interest rate you are paying on your total borrowing, loan consolidation may make sense.

Before applying for credit

Get your free annual credit report now. Review the contents. If your credit report contains incorrect negative information, have it corrected. If the negative information is correct, add an explanation to the file and prepare personal financial statements that show your net worth, income and expenses.

Name confusion in credit reports

If you are a “Junior” or “Senior,” or have a common last name, someone’s – other than your – credit information may be put in your report. Therefore, to avoid confusion in the future, when applying for credit, use your full middle or maiden name, or both, to be sure your file is not confused with others.

In a Nutshell
Understand and be careful with these and other anomalies of credit cards. And don’t trust “nobody”. Your financial life is at stake here.

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