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Color of Money

What the Credit Card Companies Want You to Miss

By Michelle Singletary
Thursday, November 11, 2004; Page E03

If you have a credit card with a variable interest rate, I'm sure you have noticed your rates have been going up.

The average standard rate at the beginning of this month was 14.13 percent, a 27-month high, according to Bankrate.com. The average gold and platinum variable rates were 13.18 percent and 11.12 percent, respectively.

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Fixed credit card rates were unchanged over the past month, with the average standard rate remaining at 12.75 percent, Bankrate.com reports. The average gold and platinum fixed rates were still 13.09 percent and 11.64 percent, respectively.

But does fixed always mean you're safe from interest-rate increases?

Please. We are talking about credit card practices here. Just because you have a credit card with a fixed rate doesn't mean it will stay that way.

You may be surprised to learn that buried in your credit card agreement is language giving your card company the right to raise your rate for any number of reasons.

Like what? you might (or should) ask.

Some will raise your rate if you start running up your other credit cards. Your rate could also go up if you fail to make more than the minimum monthly payment on your account.

Companies are looking out for folks who aren't perfect credit users.

For example, let's just say you've been late on payments for one credit card. You're having a little financial trouble, but you make sure to pay another credit card bill on time.

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