Barbara Sowell at Digital Journal recently wrote an article that examined a trend over the last few years of credit card issuers using changing bill due dates in an attempt to trip up automatic bill payers. The scam works as follows: automatic bill pay systems typically do not dynamically check the rules for a credit card account in order to determine a new bill due date each month. In order to profit more from the customers that use these systems, the credit card issuers change bill due dates over time, sometimes pushing them several days earlier. Without knowing, one can suddenly miss payment, thereby allowing issuers to hike up interest rates (APR), stack fees onto the account, and make reducing debt a painful procedure.
While this is not the only deadline-related issue that those in debt need to pay attention to, one of the worst aspects of this scam is how it targets those who use automatic payment systems – precisely the types of consumers – who want to insure timely bill pay and execute their financial transactions efficiently. The Federal Reserve did set new requirements for issuers that address this problem, but they do not take effect until July 2010. In the interim, for those who use automatic bill payment systems to reduce debt and keep tabs on bills, make sure to monitor credit card payment deadlines each month. It is as simple as logging into your account and checking it against your automatic bill payment system. Better yet, integrate deadline-checking behavior into your debt plan for the best assurance and keep in mind that automatic bill payment systems have downsides beyond the universal default clause.
Raj Patel writes for DebtGoal.com, a do-it-yourself system for getting out of debt and lowering your interest costs. DebtGoal.com incorporates all of the techniques discussed in this post and can help users understand and get visibility to and manage their debt finances.
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