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There are several traps that
lenders and credit card holders have been known to use in an attempt
to get borrowers to rack up more debt. Becoming more slick every
year, these traps can be a pitfall for the unwary consumer falling
prey to buy now, pay later deals, no interest credit card balance
transfers, and "minimized" repayment plans. If you are trying to
become debt free and are considering transferring credit card
balances to a single credit card offering low interest balance
transfers, be sure to ask what the transfer fee will be, as well as
the default annual percentage rate when the "honeymoon" period
expires. Before transferring balances, calculate whether the savings
in having no interest for the trial period outweigh the costs for
making the transfer. Also, do not transfer balances to any card in
which the default APR is hovering around 20%. If you do find a
balance transfer worth taking, do not make the mistake of trying to
pay the minimum bill each month, nor making a late payment, which
often results in an increase of the APR and high late fees. |
