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Control Your Debt - Credit Repair Advice & Articles :: Family finances: Be wary of 0% interest credit card offers

Family finances: Be wary of 0% interest credit card offers by Admin at 05:03PM (PST) on January 10, 2005 | Permanent Link | Cosmos Banks are dangling their zero percent credit card offers for longer terms. Conveniently, they're hitting just in time to pay hefty bills. But a closer look reveals there are some strings attached: A ""universal default rate."" This means you're charged a whopping fee or interest rate -- as much as 26 percent or so -- if you're late or bounce a check not only on your credit card, but also on any of your other credit cards or loans. ""A $35 [late fee] penalty is one thing. But if your interest rate goes from zero percent to 26 percent, that's about $700 or a little more than that!"" warned Robert McKinley, chief executive officer of Cardweb.com, Frederick, Md. Efforts currently are under way in Congress to prohibit this practice. A special fee or exorbitantly high interest rate on the remaining balance if you close out your account. About half the credit card issuers charge a fee or high double-digit rate on your remaining balance, McKinley estimates. ""It's a no-win situation."" Even worse, card issuers today seem to know exactly how to snare you.

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