Credit cards- Plastic Penalties

OK, so my topic today is not directly about building your own home, but relevant in regards to keeping your credit clean in order to obtain the best mortgage financing!

The article I read today on AOL finance ( indicates that creditors are finding new ‘clauses’ to raise your effective interest rates on your credit card.

Typically, being late on your payment would trigger an interest rate hike, but “credit-card companies ‘have to look for a way to keep profits up'”, and because of a practice called “universal default,” they are allowed to raise rates for a variety of reasons (certainly not an exhaustive list):

  • your credit score decreases;
  • they decide you have too much debt;
  • they decide you have too much credit available;
  • you obtain a new credit card, or shop around for a mortgage or car loan;
  • you are near your credit limit.

The article notes that if you have 700+ credit score, you should not stand for a credit card interest rate higher than 10%, and indicates a few tips to consider before contacting your credit company or seeking new credit.

Worth the read!

Also re-consider your use of credit cards and seek to eliminate the high balances!   Credit cards are an essential for traveling, internet shopping, and handy for emergencies, but DON’T use for everyday living expenses, especially consumables.    Consider having just one card each, and when you use the card, post the expense in your checking balance, thereby effectively setting aside the money for when the monthly statement comes in.

A man said his credit card was stolen but he decided not to report it because the thief was spending less than his wife did.
see more credit card jokes, along with a credit card commentary at:


1 Response to “Credit cards- Plastic Penalties”

  1. 1 Wallace May 2, 2007 at 8:19 pm

    Thanks for the addition information on how people
    can improve their credit. The more good advice a
    person gets the better.

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