Once again this Halloween, children will dress up in their scariest costumes to roam the neighborhood in search of frights and delights. Yet parents know that that the most frightening person in costume prowling their neighborhoods is often their mail carrier delivering their credit card statements. And their fears are often justified as there are still plenty of tricks that lurk within the realm of their credit cards.
Late payment ghouls. No house of credit card horrors would be complete without the frightening repercussions of late payments. If you make a late payment, your bank may impose a penalty interest rate of 30 percent APR or higher and a late fee of up to $35. So it is easy to spin a frightening tale of a cardholder owing hundreds of dollars in interest and penalties just because of late payment.
Vampire fees. Lurking in your statement could be a small charge for an innocuous sounding program that was fraudulently added to your bill. Yet unnoticed, these fees can suck money from your savings for years. And while the government is attempting to drive a stake through the heart of these monsters, cardholders still need to be vigilant.
Alien charges. If banks could levy fees on U.FO.’s they probably would. Until then, most credit card issuers impose a gruesome fee on aliens of a different sort, the foreign transaction fee. With most credit cards, a useless 3 percent fee is added to your bill whenever a charge is processed outside of the United States.
Creepy credit card interest. If you pay most, but not all of your statement balance, something truly scary happens. You are assessed interest on all of your charges from the moment of the transaction up until you get back to a zero balance. Just being a dollar short will invalidate your grace period and can trigger nightmarish interest charges for months to come.
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Cash-advance demons. If you dare to use your credit card at an ATM, be prepared for a truly horrifying result. With most cards, you will haunted by a cash advance fee of 3 percent or $10, whichever is scarier. Plus, you will owe interest on the cash advance at a higher rate, typically around 25 percent APR, even if you pay your balance in full. That should be enough to make you run screaming from your ATM.
So as Halloween passes through the night, and we enter the holiday season, watch out for these terrifying tricks that can shatter haunt your dreams as well as your finances.
Image: lobo235, via Flickr