1 Answers
ThunderWalker
Updated:05/04/2024
Many consumers with low credit scores seek credit cards to rebuild their credit, but they often overlook hidden fees.
Q&A
- Q: What are hidden fees associated with low credit score credit cards?
A: These can include annual fees, late payment fees, cash advance fees, foreign transaction fees, and fees for exceeding credit limits. - Q: How do annual fees vary?
A: Some cards may have high annual fees, while others might offer no-fee options. However, those with no fees may come with higher interest rates. - Q: Are late payment fees substantial?
A: Yes, late payment fees can be significant, often ranging from $25 to $40, potentially damaging your credit score further. - Q: How can I determine if a card has hidden fees?
A: Always read the fine print before applying. Look for terms and conditions that outline all possible fees.
Common Hidden Fees
| Fee Type | Description | Typical Amount |
|---|---|---|
| Annual Fee | Charged yearly for holding the card. | $0 – $500 |
| Late Payment Fee | Charged if the minimum payment isn’t made on time. | $25 – $40 |
| Cash Advance Fee | Charged for withdrawing cash against the credit limit. | 3% – 5% of the amount |
| Foreign Transaction Fee | Charged for purchases made in a foreign currency. | 1% – 3% |
| Over-Limit Fee | Charged when spending exceeds the credit limit. | Varies |
Mind Map of Hidden Fees
- Hidden Fees
- Annual Fees
- Late Payment Fees
- Cash Advance Fees
- Foreign Transaction Fees
- Over-Limit Fees
Statistical Overview of Credit Card Fees
| Fee Type | Percentage of Cards with Fee |
|---|---|
| Annual Fee | 25% |
| Late Payment Fee | 60% |
| Cash Advance Fee | 45% |
| Foreign Transaction Fee | 30% |
| Over-Limit Fee | 15% |
Conclusion
In summary, while low credit score credit cards can be beneficial, it is crucial to be aware of potential hidden fees. Always read the terms to avoid unexpected costs.
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