Don’t get sucked into debt by:

• accepting too many credit card offers
• using you credit cards to finance a lifestyle you can’t afford
• running up so much debt you can only afford the minimum monthly payment

Things to Think About Before You Get a Credit card

1. Don’t get too many credit cards.  Many people who get in trouble simply had too many temptations.

2. Getting a lot of credit card solicitations in the mail or by telephone does not mean that you are a good credit risk.  credit card companies want people who will run up big balances.

3.  Interest rate is not the only consideration in choosing a credit card.  Interest rate is important only if you carry a balance from month to month.  Also pay attention to the other charges, like annual fees and late charges.

4.  consider other sources of credit for lower interest rates, such as home equity lines of credit.

5.  Beware of introductory “teaser” rates.  Will you be stuck with a big balance when the interest goes up after six months?

6.  Make sure you understand how the interest rate can vary.  Read the contract to see how it is calculated.

7.  Make sure you understand the terms related to late payment.  Many companies impose late charges and increase the interest rate for even one late payment.

8.  Understand the card’s billing methods.  Is interest charged from the date of purchase, or is there a grace period?

9.  Read and understand the disclosures on the back of the credit card offer.

10.  Read and understand that contract that you receive with the card.  If you don’t like the terms, cancel the card.

Things to Think About Once You Have a Credit Card

1.  Don’t use credit cards to finance a lifestyle that you can’t afford.

2.  Don’t use credit cards to make ends meet if you are having financial difficulty.  More credit might only make it worse.

3.  Don’t get hooked on minimum payments.  This frequently will only cover the interest, so you never pay off the credit.  Also, the lender can often arbitrarily increase the minimum payment.

4.  remember when the “teaser” rate ends - don’t have a big balance that you can’t pay off when the rate goes up.

5.  If you are having financial problems, credit cards should be low on the priority list for payment.  Food, housing, and other necessities should come first.

6.  Make your credit card payments on time, if possible.  Late payments lead to fees and penalty interest rates.

7.  The special services and programs offered through credit cars are usually not good deals.

8.  An increase in your credit card limit does not mean you should borrow more money.  Lenders often increase limits for people they know will carry a large balance.

9. If you credit card offers rental car insurance, read the contract carefully before using the card to rent a car.  Otherwise, you could end up personally responsible for a large repair bill not covered by your credit card insurance.
 

1.  Unauthorized use of your card.
If someone uses your card without permission, the most the credit card company can charge you is $50.  You must inform the company as soon as you know of the unauthorized use of your card.

2.  Disputes over what you owe.
If a merchant overcharges you or does not deliver what was charged, you can dispute the charge in writing.  Information on how to dispute the charge is on the back of every bill.  A merchant whose billing is challenged can lose the the privilege of accepting credit cards if they don’t treat you fairly.