Chicago Consumers Should Weigh Rewards, Risks of New Credit Card Offers
If you've checked your mailbox lately, you probably already know that credit card companies are pulling out all the stops to lure new customers in 2011. But are the latest credit card offers worth it?
Following a period of tighter credit, credit card offers nearly doubled in 2010, according to a recent market study. On the one hand, banks are sweetening those offers with a wider variety of rewards cards and low-fee balance transfers with 0% introductory rates. And of course, consumers stand to benefit from recent legislation that did away with things like surprise interest rate hikes and unfairly high fees.
On the other hand, a credit card is just that - a credit card. And opening a new account could ultimately result in the same old trials and tribulations, caution Chicago bankruptcy attorneys.
As always, make sure to read the fine print, no matter how great that new rewards program sounds. Rewards are often capped, and many points come with expiration dates. And if you're late on a payment? Your rewards may get suspended until you fork over a hefty fee.
And sure, creditors can no longer hike your interest rates unexpectedly. But they can still charge you whatever they want upfront, which is why today's credit cards have rates of nearly 15% on average, up from 11% two years ago. And remember, any time you're late sending in your bill, your rate is subject to an increase.
Cards today may come with a different set of perks, but if you've had problems with debt in the past, chances are you'll continue to experience problems in the future. There's only one way sure to save money with a credit card, and that's to pay your balance off each month so you don't get stuck in the cycle of paying interest. But even if you already have a continuously compounding debt - or debts - it's not too late to start over. Filing for bankruptcy can often eliminate debt and put you back in control of your credit. Sign up for a free personal debt analysis with a Chicago bankruptcy attorney to learn more.