The Guide to Understanding and Protecting Credit

Fighting Back Against Credit Card Company Practices

by Walter Burch

Credit cards can be convenient to carry, they can help you track of expenses and demonstrate credit worthiness. And they offer certain buyer protections. However, credit cards can also lead to out-of-control debt that takes a lifetime to repay. The bottom line: Use credit cards wisely and sparingly. Don't fall prey to credit card company tactics that are designed to take advantage of consumers. Here are some ways you can fight back against credit card company practices:

  1. Avoid credit cards with Universal Default clauses, Double-Cycle Billing, and other predatory pricing and fees, penalties and surcharges. Carefully read the fine print in agreements before accepting a credit card.

  2. Check your credit score and credit report regularly. Credit card companies under Universal Default clauses are constantly scanning your credit report looking for subtle changes in your credit "risk profile" or score, in order to justify rate hikes. If these card companies are carefully monitoring your credit, shouldn't you?

  3. If you discover information in your credit report that you believe to be incorrect, take steps to have it corrected on your credit reports.

  4. Use credit cards sparingly, and don't over-apply for credit. This will lower your credit score and lessen your chance of receiving favorable interest rates on everything else you finance.

  5. Pay more than the monthly minimums. You won't be popular with the credit card companies because they would prefer you stay on the high-interest, debt-treadmill for the long haul, but you can put your hard-earned money to much better use, such as saving for emergencies, a child's college education, or a home for your family.

  6. Pay your credit card statements promptly. Once you have checked your statements carefully and verified all charges, pay your monthly statements as soon as possible. Many companies encourage you to be late by sending your bill as close to the due date as possible. If you wait even a few days before paying, there's a good chance your payment will be recorded as "late." Also, beware of companies who change the due date on you. This can also contribute to late payments and late fees. One customer reported a due date change occurring on an account three times in a twelve-month period.

  7. Pay down or eliminate your credit card debt entirely. This will not only take you another step closer to financial freedom, but it will also improve your debt to available credit ratio, which can raise your credit score and help you save money on a home mortgage or refinance, automobile, or even insurance rates.

  8. Check your credit card account statements carefully for any unauthorized or improper charges, fees, penalties, or surcharges. If you find a discrepancy on your statement, call your credit card company and fight to have the charges reversed. Don't give up. Credit card companies may frustrate, bully, and even threaten you, but in the end, you are the customer, and you can take your business to another company.

  9. Don't be hesitant to call your credit card company to request lower rates. Studies show that approximately 50% of all consumers who simply call credit card companies asking for lower rates are successful, often reducing rates by one-third or more! Just for asking. Why are companies willing to reduce rates? They want to keep your business, especially if you have been a profitable customer. Here is a sample script you can use when approaching credit card companies:
  10. Hello, my name is (Your Name). I have been a good customer of (Credit Card Company) for (number of years) years. Recently, I have received offers from several other companies that are offering much lower rates. I want to remain with your company, but unless I receive a (much) lower interest rate, I will have to cancel my card.

    It is also recommended that you ask for a specific, and substantial, rate reduction. Be forthright and persistent. This will help you get the highest rate concession that the credit card company is willing to extend, given your account history and profitability profile. If the person you are talking to won't or "can't" help you, ask to speak to a supervisor, and call repeatedly if necessary. A few minutes standing up for your rights as a good customer could help save you a significant amount of money.

  11. Carefully compare credit card offers before applying for credit, and review the terms in cardholder agreements before accepting cards. Once you receive your card, check the fine print carefully. If what you applied for is not what you received, take your business elsewhere.

Lesson 1: The Guide to Understanding and Protecting Credit
Lesson 2: Your Credit Report: The Picture You Present to Lenders
Lesson 3: Your Credit Score: A financial asset worth protecting
Lesson 4: How to Make Sure Your Credit Reports Are Accurate
Lesson 5: How to Improve Your Credit Score
Lesson 6: Credit Monitoring
Lesson 7: Identity Theft
Lesson 8: Identity Theft - 7 Common Warning Signs
Lesson 9: Identity Theft - How You Can Prevent It
Lesson 10: Identity Theft Victims - Steps to Take
Lesson 11: Keys to Credit
Lesson 12: Separating Fact from Myth
Lesson 13: Top Ten List of Worst Credit Card Company Practices
Lesson 14: Fighting Back Against Credit Card Company Practices

Click here to get your Credit Score, Credit Report and a 3-Bureau Credit Monitoring Free for 30 Days.

Get Out of Debt
Stay Connected with TDS

Do you struggle to get ahead financially?

Surviving Tough Times is a weekly newsletter aimed at helping you stretch your dollars and make the most of your resources.

Debt Checklist

And get a copy of Are You Heading for Debt Trouble?
A Simple Checklist and What You Can Do About It
for FREE!

Your Email:

View the TDS Privacy Policy.

Get Out of Debt