- Rose Kennedy For the AJC
With credit cards, what you don't know can cost you.
Luckily, most of what you need to know is right at your fingertips − your credit card statement. Review it with a critical eye, and you'll save money, correct errors and even stop fraud.
Your transactions: Credit card companies do make errors. Review your statement every month to catch these errors early and correct them, advises Credit.org, a nonprofit financial education group. Each monthly printed statement should include a detailed list of activity from that billing cycle. If you get online statements, you can usually see transactions before and after the bill's closing date, too.
Credit.org also recommended keeping credit card paper or email receipts to compare to your monthly credit card bills. If you see something that's not correct, act immediately to protest. You are only protected when you report a discrepancy within 60 days of getting your credit card statement.
And don't just go after the big, noticeable fraudulent charges, the Credit.com blog warned: "It's actually the small ones that are the most likely to creep into your statements unnoticed. Thankfully, federal law says that cardholders are never responsible for more than the first $50 of any fraudulent charge, and nearly all card issuers waive this requirement by offering zero liability policies."
Late payment warning disclosure: Don't skip this. Credit card issuers are required to post a late payment warning disclosure explaining precisely what will happen if your payment is late, according to the Balance. First you should understand that late means after 5 p.m. on the payment due date. The disclosure should also include the amount of any late fee and possible penalty APR if you don't make the minimum payment by the due date. According to the Balance, late payments are limited to the lesser of your minimum payment or $25, or a maximum of $35 if you've already been late on a payment within the past six months.
However, the late payment disclosure doesn't tell you about the effect of late pays on your credit report. It's up to you to know that once a payment is 30 days past due, the past due account status may be reported to a credit bureau. Once you bring your account current again, your bills and online account will show that you're caught up, but your credit report will retain the late payment record for seven years.
Credit card issuers are required, by law, to send your monthly credit card statement at least 21 days before your minimum payment is due. Of course, if you opt to save paper and postage and receive only online bills, you are responsible to make sure you log onto your bill and pay. According to Credit.com, one way to improve your odds of paying either type of credit card bill on time is to set up reminders or even automatic bill pay.
Any notices of changes to your interest rate: Read your credit card statement carefully to get interest rate specifics and start addressing them, according to MyCreditUnion.gov. When you trigger the penalty rate with a late payment or going over your credit rate, the company may notify you that your rates will increase. You must be informed at least 45 days ahead of the rate change activating, which is another reason to make sure you check your online statements reguarly -- monthly at the very least.
If you catch this increase notice quickly and it's due to a single late payment, Credit.com suggested trying to contact your card issuer to request a one-time waiver of the late fees and penalty interest rates. And since the credit card company isn't permitted to impose the penalty rate unless you've been 60 days delinquent on your payment, according to the Balance, make sure to verify that you've been that late and protest if your records show you haven't.
To see a sample notice of interest rate change, check out the interactive credit card statement at the non-profit's website. to familiarize yourself with the terms commonly included on a real statement.
The minimum payment warning: Minimum payment copy is now required by law. The disclosure is listed within your statement, detailing the sometimes horrifying amount of time it will take you to pay your balance, including interest charges, if you stick to making only the minimum payment. Make sure to read this every month, the Balance advised. This may encourage you to up your payment to avoid paying maximum interest. If you are trying to pay off more than one credit card, comparing minimum payment warnings will also let you know which card to focus on first.
To set a personal deadline for paying off a credit card, find a reliable credit card repayment calculator like the one offered at Credit.com.