Estimated read time: 1-2 minutes
Asa Aarons, NBC NewschannelThe best and simplest credit advice has always been, "pay your bills on time," but that may not be enough. We can also add to the advice by saying pay all your bills on time, and be wary of any new ones you acquire.
Richard Dempsey keeps a close eye on his finances and has an excellent credit rating, which is part of the reason a recent development with his credit card really shocked him. "The rate suddenly leapt from eight point nine nine percent to twenty three point nine nine percent," says Dempsey.
Richard says the bank's explanation was even more puzzling. "Not that anything was late or missed or anything of that effect. It was just that we had too many high balances."
In fairness to the bank they had sent him a notice. Richard believes he threw it out as one more piece of junk mail. "If we got this we certainly wouldn't have ignored it and uh make this right in terms of the original percentage, close the account and we'll pay it off at that old rate."
What the bank did was perfectly legal, and could happen to you tomorrow.
The best consumer defense?
Always pay your bills on time.
Being late on one can increase the interest on another. Monitor your credit on a regular basis. Understand your card terms. And most importantly, read your mail.