Do You Still Need to Read Your Credit Card Contract's Fine Print?

credit card applicationSometimes public pressure really does pay off: There are signs that complaints from consumers and regulators about the lack of credit card contract transparency at banks have not fallen on deaf ears.

CardHub.com recently released the results of its 2011 Credit Card Application Study. They visited the websites of the top 10 issuers, based on outstanding balances, and assessed how clear essential information was based on how easily they could locate it. Issuers lost points for making the information harder to find, if clicking to a new page to find pricing information was necessary, and if consumers had to dig deep and read the find print to find vital info. (Cardhub didn't make a similar study of the banks' hard copy documents.)

CardHub.com focused on a set of specific information important to the customer: Did the banks' websites make plain how rewards points were earned and how much they were worth to the customer? Were annual fees clearly and prominently displayed? Was it easy to determine the introductory and regular APRs without having to go hunting through the fine print? How about for balance transfer fees?

Credit card transparency

The good news for consumers is that credit card issuers are getting a less enigmatic and opaque: The majority of issuers improved their absolute scores in the 2011 study relative to 2010.

"The most significant thing about these findings is that we are really starting to see increased transparency across the industry," says Odysseas Papadimitriou, CEO of CardHub.com. "I think this is a direct result of the CARD Act and the fact that regulators are once again doing their jobs."

Capital One, (COF) and Bank of America (BAC) continue to be the best performing issuers, with top scores of 98.6% and 97.9%, respectively. The most improved issuer was U.S. Bank, (USB), which improved its score by 32.1 percentage points. The two issuers that scored the lowest were Discover (DIS) and Citi, (C), with scores of 82.5% and 82.1%, respectively -- identical to their scores from the year before. Both issuers fell by four positions in the rankings as other banks improved. But overall, the gap between the highest and the lowest scores is less than half as large as it was in 2010.

The big surprise says Papadimitriou, was U.S. Bank. "It drastically improved the clarity of its online applications since last year, and I think it's a great credit to them that they made these changes. It went from a score of just 59.3% in the 2010 study to 91.4%."

What does all this mean for you? "With all top 10 issuers getting a score between 82% and almost 99%, the average consumer can feel pretty confident that without reading the fine print they will be able to get all the key information that they need in order to make an informed decision as to the attractiveness of a particular credit card offer," says Papadimitrou. "That's not to say that they should not still read the fine print of the credit card they decide to apply for, but for comparative purposes they no longer have to do that."

There is still room for improvement though. Says Papadimitrou, "Information related to how valuable your rewards points and miles really are and information on the balance transfer fee continue to be the areas that lack the most transparency and therefore consumers should proactively seek that information. Be proactive in getting that information."







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daballofire

While we are at it. If you don't have any skin in the game by paying income taxes, you don't get to vote either. You will just vote for a Socialist who will redistribute my wealth that I worked hard to accumulate by stealing it unwillingly from me as a common thief and give it to someone who does not deserve it. You make bad decisions you suffer the consequences. I am not your keeper or your piggy bank.

September 06 2011 at 10:42 PM Report abuse rate up rate down Reply
daballofire

If banks can screen folks based on their income and credit score, they should also be able to screen on political party If they didn't have to loan to Marxists posing as Socialist, progressive, liberal democrats who hate them and have no intention of paying the loan back. The banks would be much more profitable, not have huge losses on the loans of all kinds, complaints would dry up and we wouldnlt have to bail them oiut ever again,

I guess the same could be said fir employers adn business owners. Why should they hire people who hate them, are poor workers, cause trouble and are anti-capitalist?

We need a Business Owners and Bankers equal rights amendment badly and as soon as possible.

September 05 2011 at 2:02 PM Report abuse +2 rate up rate down Reply
daballofire

They are not transparent enough. You still can't see through them yet :-)

September 05 2011 at 1:47 PM Report abuse +1 rate up rate down Reply
ATM

Anyone interested in class action suit against American Express, Bank of America, HSBS, and other companies that attempted to raise rates above 15% when they had been bailed out and were receiving funds at 0.25% from the Federal Reserve window?

I am. If you are too, indicate so on this board. The time has come for consumers to fight back with strength, and to make them pay dearly for their efforts to jam it down our throats.

During hurricanes, the government claims fraud when stores charge excessive amounts for water, lumber, etc. -
Well- this was a financial storm, caused by the financial industry - and the Government allowed them to raise pricing excessively, taking advantage of disadvantaged people - it was no different than a hardware store tripling the cost of botteld water during a hurricane.

Thee companies need tobe exposed, taken to court, and shown for the actions that represent who they are. Cancel your cards and accounts with these predators, and stand up for consumer financial rights!

Don't let politicians, who are on the doll of financial firms, continue to favor the financial indistry over tax payers' rights! It is time to boycaott and refuse to use cards from firms that raised rates on disadvantaged people during the financial crisis, and it is time to make them pay, by reducing their revenues and profits, for immoral business decisions!

September 05 2011 at 9:10 AM Report abuse -1 rate up rate down Reply
ATM

Check out www.mybadbankexperience.com and learn about ways to protect yourself from credit card predators.

The credit card companies committed acts that caused irreparable harm onto consumers, by unilaterally lowering credit limits to amounts just above the outstanding balances on millions of cardholder accounts. IIt lowered FICO scores in two ways - reduction of credit, and higher debt-to-limit rations. I know - Bank of America did it to me, in spite of a strong payment history.

How to fight back?
Cancel accounts, and settle for 45% of balances. All of the cards are in settle mode, and when they try to raise your rates to 15% or higher when rates are at historic lows, they deserve to lose your business.

This is was against the banks and credit card companies - they defrauded Americans, and caused damages to us all - in their reckless pursuit of excessive profts. 15%-15% interest rate charges on credit cards should be illegal- it is already immoral. I applaud anyone who cancels their accounts and tells the card companies to shove it - let them fry!

September 05 2011 at 9:03 AM Report abuse rate up rate down Reply