The following are charged by most credit card companies under almost all circumstances, .
- Annual fee - Paid for being a user of the card
- Cash advance - fee. Paid when the card is utilized for making a cash advance; usually a flat fee or a percentage of the amount advanced
- Balance transfer - fee. Paid when a balance from another credit card is transferred to the other card. Checks are usually sent to pay-off the card. Balance transfer happens when the check is used to settle the amount due on the other card.
- Late payment fee - Paid if payment was done after the date due
- Over the credit limit fee - Paid for payments exceeding the credit limit
- Credit limit increase fee - Paid for a credit limit increase request
- Setup fee - Paid for opening a new credit card account
- Return item fee - Paid for returned checks when bill payments by check was done for insufficiency of funds (meaning, the check bounced)
- Other fees - Payments made for over the phone settlements, cost coverage for credit bureau reporting, account review, provision of other customer services. Other fees and charges are information which may be found on the credit card agreement.
The credit limit is the maximum cost - for making purchases, cash advances, transferring balance, finance charges- which may be charged on the credit card. An over-the-credit-limit fee will be paid for exceeding the credit limit.
Features and Incentives
Incentives and special features are offered by many credit card companies for using the card:
- Rebates and discounts on purchases
- Regular flier miles or minutes for telephone conversations
- Additional warranty coverage for purchased items
- Insurance for car rental
- Insurance for accidents incurred while in travel
- Credit card registration, in case wallet is lost or stolen and a report of missing credit cards had been made.
- Insurance coverage on credit card balance: Payments for card holders who become jobless or disabled or suddenly die. Premiums are usually paid monthly, allowing payment cancellation if payments are more than what the desired payment amount is or if the insurance is no longer needed.
- Insurance coverage for the first $50 of charges, in case card is lost or stolen. Charges over $50 are protected under federal law.
Prior to availing of these special features, carefully decide whether these features are needed. Never pay for a feature that is of no use to you.