Nuts to credit card over-limit fees
- February 20, 2010
- 0 comments
- Posted in Credit Cards, Latest Posts
New credit card rules take effect Monday, to block some of the banks’ most abusive practices. If you’re not careful, however, you might find yourself agreeing to be abused again. There will be campaigns to get you, voluntarily, to take one of the nastier fees back onto your account.
I’m talking about the over-limit fees that banks have been draining from the accounts of people who use their credit cards to the max. If you accidentally charged more than your limit, banks were charging you $25 to $35 every time. It didn’t matter how small the violation was. If you used your card to buy $6 in coffee and doughnuts , and that purchase put you $2 over your limit, you’d be socked with the fee. If you charged one major purchase and four smaller ones, the card company paid the big charge first. That might have put all of the smaller ones over the limit, racking up a $35 fee for each.
Under the new law, banks have to get your permission to charge over-limit fees. Some of them are urging you to sign up now, for the “peace of mind” it brings. Peace of mind, Ha! This “service” brings only worry that you might have to pay $70 in fees for two ill-timed cups of coffee.
Other banks are warning you that, if you try to charge something over your limit, the purchase will be turned down—just like in the old days, before these fees were invented. Should that happen, the bankers are hoping that you’ll come weeping back, begging to be hit with those fees again.
Nuts.
Don’t agree to pay the abusive fees that the law has just relieved you of. If you’re at your spending limit and your card is declined, pull out another, cleaner card to put the transaction through (you do have a cleaner card, right?).
Even better, know your credit limits and never get close to them. If you charge no more than 40 percent of your credit-care limit, you’ll get a better credit score, too.
Tags: credit card fees, Credit Cards, over limit fees
