Watch Out for These Card Offers

Uh-oh. The credit card companies are losing money, which can only mean one thing: Card carriers are going to be more aggressive about reaching out to qualified customers with "great" offers that some consumers can't resist.

The most recent evidence comes from last weekend’s holiday shopping figures. According to America's Research Group, just 26% of U.S. shoppers paid for their purchases with a credit card.

It’s an alarming shift in credit card company profit margins. The ARG estimates that shoppers who pay via plastic are prone to spending up to 40% more on holiday gifts.

To get back in the game, card issuers will no doubt dive head-first into the marketing waters, and once again send those ubiquitous credit card offers that fill both mail boxes and inboxes.

But be careful — some of those offers are just bad deals. Here’s a list of which ones to avoid.

Watch out for zero-rate, low-balance deals. Card companies aren’t reaching out to you for humanitarian reasons. They’re in it to part you from your cash. Keep that in mind when you see an offer for a zero-interest or low-balance transfer credit card. Buried in the fine print on such offers are traps like automatic rate-hike triggers when you pay late or change the rules on rate increases after card balances are paid off. Make sure you read the fine print and ask questions. Know specifically what can create a rate hike. If you don’t like what you discover, take a pass.

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