Here's seven common clauses consumers might watch out for when they sign up for a credit card or checking account.
Got a fee-related complaint for your bank? Your bank's got a message for you: You agreed to it – live with it.
Over the past year, the consumer banking industry has come under increased scrutiny in Washington for interest-rate hikes, questionable legal practices, and debt-collection procedures. And when bank representatives appear before Congress, they often repeat the same message: Whatever their practices, their consumers agreed to them.
Of course we did. Unless we want to hide our money under our beds, we have little choice but to play by their rules. But if you're like most, you've thrown out your checking-account or credit-card contracts long before you read all of its legalese.
And it's not as if financial institutions are scrambling to draw your attention to the contracts. In some cases, consumers have to blindly agree to a credit-card holder's agreement when applying for a card; and only get a chance to look at it when they receive it, their new card, and a bevy of inserts in the mail sometime later.
Figuring out what it all means can be difficult. Interest rates can be calculated in a variety of ways, and the ultimate effects of certain clauses aren't always clear. "It's getting to the point where it's like opening up the guts of a Dell and a Mac and asking to choose based on that," says Kathleen Keest, senior policy counsel for the Center for Responsible Lending.
But what you don't know can hurt you: You may assume you have rights that you've actually signed away, and knowing what the rules are now can save you major financial problems later on.
To help, we're magnifying the small print. Here is a by-no-means-comprehensive list of common clauses to be aware of before signing up for that next credit card or checking account:
1. Your bank gives you access to money, and your bank can take it away.
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