Read Your Credit Card Junk Mail Before You Toss It

If you're in the habit of tossing mail from credit card companies before opening the envelopes, you might want to rethink your strategy.

With creditors in the process of making changes to counteract stricter regulation, it's likely that some of those envelopes you assume are just advertisements or routine legal notices are actually important updates from your credit card company of changes that could impact you financially.

For instance, both Bank of America and Citibank announced plans this year to begin testing an annual fee on certain credit cards. And American Express recently notified holders of its airline cards, including Delta, JetBlue and Hilton and Starwood hotels, that it would be revoking rewards to customers who don't pay their bills on time, whether they're repeat offenders or normally careful consumers who happened to make a one-time mistake.

Other predicted changes include higher late fees, a fee for calling customer service, receiving paper statements or merely requesting a higher credit line and higher interest rates. My words of advice? Check your mail carefully.

Consider making a file to save all those notices. That way, you won't be surprised when a new fee pops up on your statement. And if you do find a fee you weren't aware of, you'll be able to call your creditor out for failing to notify you.

Meanwhile, keep an eye on your account so you'll notice immediately if a charge seems suspicious. Try managing your account online, where you'll have the most up-to-date information and the fastest bill payment, and, if possible, sign up for automatic bill pay. Besides, this way you won't get dinged for having paper.

If you see something you don't like, try negotiating with your creditor. When you're facing a costly annual fee, much higher interest rate or some other atrocity that strains your already tight budget, consider threatening to cancel your card and, if necessary, actually doing it. But keep in mind that if it's your oldest account, eliminating it could be detrimental to your credit score; in that case, it might be better to keep it open and avoid adding to your balance. It's a call that depends on your personal situation.

And if your debt is just plain out of control, don't waste your time hoping it will heal itself. It won't. The sooner you lower your debt burden, the sooner you'll lower your interest payments and free up cash for other obligations. Bankruptcy can help you find a fresh financial start. To find out more, sign up for a free one-on-one debt analysis with a Chicago bankruptcy lawyer. Let us help you get out from under the thumb of creditors - and back in control of your life.

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