You can fix these mistakes and keep your score high

Monday, January 13th, 2014

You hardly find a person who hasn’t made a mistake involving a credit card. It happens to all of us. These mistakes can be costly if they come in form of fees, interest charges and damaged credit history.

Fortunately, the credit card issuers can forgive you some mistakes. If you start making right steps and have got a habit of being prompt, you will be able to fix most of mistakes and even reverse the damage.

Read the following common credit card mistakes and find out what you can do when they happen to you.

Being late with a payment

Credit card users make late payments due to different reasons: they simply forget or the payment got lost. If you are late with the payment you should immediately contact your credit card issuer. Ask the representative to have your late fee and interest charges refunded. Often, you will be refunded, because credit issuers do not want to lose valuable customer. However, you constantly late and miss the payments every month, that may not work.

Lowering credit limit

Some people mistakenly believe that reducing their credit cards limits can raise their credit score. That is not exactly true. When you reduce your credit limit, you raise your credit utilization ratio and rising the ratio you hurt your credit score.

The credit utilization ratio is calculated using your total amount of debt divided be total amount of credit you have been extended. So to fix this mistake you will need to ask for credit limit increase, or apply for a new credit card. As long as you do not increase you debt, you can easily restore or lower your credit utilization ratio.

Spending too much

Those who do not track the spendings on their credit cards risk over limiting their cards. Maxed out cards will bring you more fees and higher rates and lower your credit score. But you still have a way out of this situation. Recently purchased goods you do not need may be returned. Many cards have return protection policies that cover you even if the seller denies return. For instance, if you are a Visa cardholder you can return your purchase within 90 days. The refund will be up to $250 a month and up to $1,000 a year.

If this option is not for you, you can minimize interest charges by paying the statement balance in full. Making the largest possible payment as early as possible will work as well. You will save on interest because it is calculated based on your average daily balance. Also, if you pay early, before the statement closes, the card issuer will report a smaller amount of debt to the credit bureaus.

Losing card

People lose cards but a rare person calls to the credit card issuers right away they discover it. You will save time and money if you immediately call the issuer and ask for card replacement. Many issuers will replace your lost card for free and rather quickly. It is because they want you to keep using their card.

Applying for a wrong credit card

Many people apply for wrong credit cards by simply picking up the first offer they like. They sometimes don’t even care about looking around and comparing credit cards. But what to do if you apply for one card and later come across a better offer from the same issuer? Simply contact the credit card issuer and ask to apply the other offer to your account. The issuer representative may simply change the offer in your account.

So, if you make a mistake do not hesitate to contact your credit card issuer right away. You will be astonished how credit card issuers can be willing to help.

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