Credit card holders often get shocked when they receive some unexpected charges, late fees, or find out that the interest rate showing in their account statement isn't what they expected. A wise man who’s using credit cards will definitely advise you to check your credit card's fine print. But actually no one cares about this matter. Practically, you should read the credit card's fine print with caution.
Out of 10 people, every 6 adults (nearly 58%) confirmed that they would rather follow their utility/credit card bills than reading online terms and fine prints. Also, 43% of the above-mentioned people say that they find those terms and conditions hard to understand. But, by not reading those fine prints on credit cards, they might fall into the dark about their rights. Several survey reports reveal that at least 21% of people are suffering from the trouble they’ve caused by signing the terms and conditions documents without checking them properly. 1 out of 10 people are having longer contract as they didn’t read the fine prints at all, and 1 in 20 people lost their advance amount being unaware of the exact terms and conditions regarding hotel or holiday bookings.
There are certain rules and conditions, which are totally different from one card to another. These rules and conditions can cost you way more than you can imagine. Credit card fine prints may contain such information, which may cost you several charges and fees. So, let us know about those things in details.
1. Fine print is much formalized now
Nowadays, the actual cardholder agreement has very little fine print on it. Everything is fixed as per your agreement, whether it’s the interest rate or your late payment fee. Every aspect is right there in front of your eyes, there's hardly any exception in every card.
However, credit card agreement can be classified in 4 types:
1. the cardholder agreement
2.the privacy policy
3.the rewards program agreement
4.the benefits agreement
There are 4 types; first one and latter are usually written when there are 2 options.
2. Look for the arbitration clause
First you need to know what an arbitration clause is. An arbitration clause is an agreement for which the parties need to resolve any conflict between them through an arbitration procedure. If you’re facing any problem with the credit card company or find any dispute with your account. You can't sue them without submitting to arbitration form. But you'll be unable to file a class action lawsuit. You know for sure that a credit card company rarely loses in arbitration.
3. Avoid late payments
You may understand the English language very well, but you might still need to understand the terminology of credit card accounts. It’ll help you to know the credit card agreement well.
One mistake to understand the terms and conditions may cost you thousands. In case of late payment, you’ll be charged the late fee and also need to pay the interest retroactively. You normally have to pay interest for 30 days, which is similar to the 60 days worth of charges. Your credit card company may not charge you the late fee if you’re late for the first time, or if you're 1-2 days late. But, if you’re late for more than 2 days, or you’re neglecting your responsibilities for many times, I am afraid, you’re in trouble.
4. Your Rewards Program
The rewards program and the agreement lure the consumers to select one card over another. They’ll find new unique features like price protection and extended warranties. The fine prints can be very beneficial in this situation. Insurers don't normally entertain these features, but they can end up being very valuable to customers.
Many rewards cards have limits on the number of points. This is helpful for you in two ways - first, at the end of the year, you can get to your limit and increase the limit as per your requirement. Second, you can stop using any rewards cards if you hit your limit.
So, it is quite necessary to read all the terms and conditions written in credit card fine prints. Make sure you read them and confirm with the bank if there is any confusion. Last of all, wisely use your credit card and pay the bills on time.