If you’re like most credit card users, chances are that you quickly scan your credit card statement when it arrives in the mail, check your balance on the front page, and then chuck it into the trash. You could be making a big mistake if you neglect to scrutinize your credit card statement’s fine print, at least once every couple of months. The fine print is typically the place where credit card companies sneak in the most essential details about your account. If you aren’t aware of the various account terms and conditions — or any changes that could be in your future — you might set yourself up for some very costly blunders. Knowing how to decipher your credit card statement fine print arms you with the knowledge to become a more responsible credit card user. The next time your credit card statement arrives, be sure to check out these top six areas.
1. Notices of Changes to Interest Rate
If your credit card company has plans for an interest rate increase on the horizon, it is required to advise you of the increase at least 45 days before it takes effect. You should be able to find this information near the top of your credit card statement, typically under a boldface heading such as “Notice.” The information should also specify the date that the higher interest rate will become effective. The credit card company may or may not advise you if it will be increasing your interest rate if you miss a payment or reach your credit limit — but if it does have such a policy, you will likely be able to find that information in this area as well.
2. Dispute Charge Policy
When the time comes for you to dispute a charge with the credit card company, you need to know about your card’s specific guidelines for doing so. The credit card statement fine print will typically outline everything you need to know about their dispute policy — where to email or mail your correspondence, what documentation to include, and the basic framework for the card’s dispute investigation process.
3. Explanation of “Other” Fees
On the back of your credit card statement, the issuer explains various fees that may be applied to your account, depending on your usage. For instance, if your card allows cash advances, the fine print will clarify the fees you incur each time you use this perk. Be sure to peruse this area of your credit card statement thoroughly. The fine print may also address fees that most card users wouldn’t expect — such as fees for the card company to report your account activity to the credit bureaus, pay by telephone, or other customer services.
4. Interest Rate Calculation
If you want a comprehensive rundown of how your credit card applies interest to your purchases, your credit card statement is the place to find it. The fine print should also address the timing of the “grace period,” also known as the date by which you would need to make a payment before interest is assessed.
5. The Date Your Card Issuer Reports to the Credit Bureaus
Knowing when the credit card company reports to the credit bureaus is essential if you have goals of improving your credit score. Some card companies are more helpful in this area than others. If you are scheduled to make a payment after the credit card company reports to the credit bureaus, the company will likely report the balance it had on file for you at the time — even if you paid it off in full just a few days later. Sometimes, the credit card company reports the information on your statement closing date — but this can vary from issuer to issuer (which is why checking your statement is so important!).
6. Rewards Cards Provisions
Many Americans carry at least one rewards card in their wallets. As valuable as they can be, rewards cards often come with their own elaborate set of terms and exceptions. For instance, your credit card issuer might stipulate that you will have to wait a number of weeks for rewards points to be applied to your account. The fine print will also discuss the conditions that must be in play to remain eligible for those rewards — such as the length of time your account has been open and whether or not you have missed a payment.
Keep Up the Momentum
Reviewing your credit card statement is also an excellent way to spot errors or even fraudulent charges. If you find either one, you’ll have a solid reason to take up a dispute with your credit card company. At Ovation Credit, we can help with that dispute process, saving you the time involved in building a case yourself. Contact us here for a free consultation.