Credit Card Terms and Other Borrowing Facts

Question: The news mentioned changing credit card terms and Congress getting involved with restrictions on credit card companies. Does that mean the terms on on credit cards will change? Ellen – Parrish, Florida

Answer: Credit card terms always seem to be changing, especially in today’s financial environment. However, no matter what congress does… before you ever borrow – and getting a credit card is an application for credit and borrowing. You must get the facts and understand the credit terms and obligations, then you can wisely decide or choose if borrowing is the right for you. Make that a part of the way you approach anything to do with finances and other parts of life – understand before making a commitment. In making ordinary purchases of clothing, appliances, furnishings, etc., you ask questions to get information you want. What is it made of? Are there and special use requirements? etc.

Similarly, you should understand your credit transactions. That means reading and understanding the fine print on your credit card application. Understand what you sign. Any reputable credit source is willing to explain a credit contract and terms, and any legal regulations applying. If such information is not given satisfactorily, you should not sign. Once you establish an account with a credit card company, or an installment purchase at say a furniture company you can generally increase your credit limits on your account without difficulty.

In making application for credit, provide the truth and facts as required. Failure to do this has spoiled many a credit record; and obtaining credit by false information or by concealing important information, could be serious. The purpose of a credit interview, or investigation, or requirement to answer certain questions, is to determine that the applicant plans to and does use credit wisely, that they will not be “over-loading” themselves – meaning they have the capacity and ability to make payments on time for the period of the credit, and that they will be reliable and trustworthy.

Do not forget – You make your own credit history – credit bureaus only record it, – they do not make it. You can change and improve your credit record for better or worse, but you can’t evade it.