Recent increases in credit card fees and charges have consumers paying more cash for their credit cards. In the past year, credit card fees have gone up at an increasing pace, and they're currently higher than they've ever been. Cardholders who haven't read the fine print might be unpleasantly surprised to discover how much they're paying for convenience.
In April of 2005, some credit cards in certain states imposed the Universal Default clause, inciting outrage and causing the APR of many cardholders to shoot skywards. Universal Default means that if the cardholder has a late payment on any bill he holds, he becomes eligible for a sharp increase in his credit card APR. Many are calling this practice sneaky and unfair, because if the credit card bill is paid on time, presumably the credit card should remain in good standing and have lower finance charges. Some cardholders were slapped with a higher APR without notice or explanation.
Since Universal Default crept in, other credit card fees have been on the rise as well.
In recent years, many cards have steered away from using an annual fee, because the lump sum payment tends to scare people away. Instead, cards offer a monthly maintenance fee, which can range from $6 to $18 a month. It doesn't sound like much until you realize you could be paying well over a $100 a year to maintain your credit card. As monthly maintenance fees become the norm, it has become easier for credit card companies to charge more, since consumers aren't paying much attention to a small payment per month. In the past year, monthly maintenance fees have skyrocketed. Again, those consumers who aren't paying attention are being unpleasantly surprised by the fact that the card that cost them a certain amount last year has sneakily gone up in charges this time around.
If you have a credit card, or plan on getting one, please read the fine print. Make note of APR increases or other imposed fees that seem unfair. As a consumer, there isn't much you can do about increasing credit card fees aside from canceling your card. Nonetheless, stay aware; if a fee increases without explanation, call the company and ask why. It's important to stay on top of the changes in order to stay control of where your money is going.
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