4 Devious Credit Account Commercials from Reputable Companies

Before you jump on the first commercial credit account your company is offered, take the time to read the fine print. Those glitzy and entertaining commercials may be misleading or even downright devious, and the actual contract looks nothing like you thought it would be. Watch out for the Universal Default trap, unbelievably low interest rates, and clauses that allow the company to apply other fees and costs to your account.

Credit Companies Want Your Business

The cost of a commercial credit account tends to be higher than a personal account. Credit vendors are trying to get their own slice of the money your company has worked hard to make, and they sometimes seem willing to go to any lengths to draw you in, such as offering large initial frequent flier miles, or promising a specific length of interest free usage.

#1: If It Sounds Too Good to be True...

The old cliché applies to a commercial bank credit card the same as it does to other things. If the deal you are being offered sounds too good to be true, it probably isn't going to turn out to be what you are expecting. If a company issues you a credit account, they have every intention of profiting from your business, no matter how "free' the offer may look on the surface. Watch the commercial carefully for the fine print which gives the actual terms of the contract, or a disclaimer that the terms being presented are conditional on one or more clauses in the contract.

#2: Universal Default Clauses

Be very careful of credit card commercials that offer cards with a universal default clause. It may sound harmless, but this clause gives the company explicit permission to increase the rates they charge you if you happen to be late making a payment to a completely different credit agency. Having more than one account with this type of clause can be prove to be very expensive quickly, especially if high credit balances are involved.

#3: Delayed Interest Rates

Some ads will promise very low interest rates for a period of time. On the surface, this looks like quite an introductory deal, but what the ad is not telling you is that if there is a balance on the card when interest rates go into effect, you will be charged the full interest on that balance, backdated to the date it was charged to the card. As you can imagine, this could potentially change a comfortable remaining balance into a an dangerous account overdraft without you ever realizing it is coming, resulting in even more fees and charges, possibly even inflated new interest rates.

#4: Pay in Full Offers

Some credit companies will offer zero interest for new customers, similar to the way the delayed rates are handled. In this type of offer, though, the condition is that your entire balance must be paid off every month. Failure to makes a complete payoff could result in outrageous interest rates being applied immediately.


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