Citibank's Citi Simplicity Card: Now You Can Avoid Late Fees
- Author Edward Vegliante
- Published January 10, 2006
- Word count 569
Citibank recently launched a new credit card that takes away an important sting felt by many consumers: late fees. In an unusual move, the bank is now offering consumers “permanent forgiveness” for late payments and will no longer assess the customary $39 late fee when a payment arrives after the due date. While the offer sounds great on surface, if you dig a little deeper you will soon learn that there are some things about the new Citi Simplicity card that can cost you more money in the long run. Let’s take a closer look at what this credit card issuer is really offering with its new card.
The Problem
Consumer advocates have long cried foul when it has come to credit card late fees and penalties. Not only would you be assessed a one time late fee ranging from $29 to $39 if your payment arrived late, but your interest rate could be permanently increased to the default rate, typically as high as 29% annually. This “double whammy” further made it difficult for you, the credit card holder, to ever pay down debt.
Citibank’s Solution
In a bold marketing move, Citibank – one of the largest issuers of credit cards in the world – came up with its Citi Simplicity card in response to criticism levied by consumer advocates at the industry and at the bank personally. The new card, with no annual fee and no late fees, is designed for card holders who have been bitten by the late fee bug. No longer will you, as a card holder, have to worry if the check you sent off just before the payment due date arrived on time. With the Citi Simplicity card, a late arriving payment will be credited and no late fee assessed.
Taking a Closer Look
Within Citibank’s offer are a few things that you should understand before you make the switch:
-
A late fee will not be charged to your account, but your interest rate may surge to the default rate. The default rate, in this case, can be as high as 29%! That’s bad news for you especially if you had a fixed low rate previously.
-
You could also get a false sense of security by incorrectly believing that paying late regularly doesn’t harm you in some other ways. For instance, consistently forwarded late payments can become part of your credit report, thereby negatively affecting your ability to purchase a car or a home down the road at a favorable interest rate. Important to note, a higher interest rate can add thousands of dollars to the purchase of a new home.
-
Finally, Citibank will waive the late fee only if you promise to continue to use the card. This is bad news for you especially if you are trying to reduce your balance each month without having to purchase something new, which simply adds to your balance.
In all, the Citi Simplicity card has much more to it than what meets the eye. For some people, the new card is a welcome change especially if you are one who pays off his balance in full each month. If you aren’t, the Citi Simplicity card may cost you much more in the long run. Should you fall into this second category, it would be better for you to keep your existing card or shop for a new card with other features and more favorable requirements.
Ed Vegliante runs the website http://www.credit-card-surplus.com , a well organized credit card directory enabling the consumer to compare and apply for a variety of credit card offers including the Citi Simplicity Card.
Article source: https://articlebiz.comRate article
Article comments
There are no posted comments.
Related articles
- Effective Strategies for Paying Off Your Mortgage Faster
- How Does Equity Release Work?
- Florida First Time Homebuyer: The Indispensable Guide of Tips, Programs, and Resources
- How to Become Debit Free?
- Sellers Concession the Closing Cost Option
- Financing Short Term rentals with DSCR loans
- Why move to Roseville CA
- Simple Interest Mortgage Advantage
- Are Low Doc Commercial Loans available in Australia
- How to Obtain a Rural Agriculture Loan Quickly and Easily
- What is a Caveat Loan?
- Tips for improving your Credit Score before getting a Home Loan
- 3 Things To Look out for With An Equity Release Mortgage
- Manage your Debts by Refinancing your Current Home Loan
- How to Get a Home Loan with Unusual Employment or Income?
- 20 Effective Debt Consolidation Loans Tips with Bad Credit
- Tips for Choosing a Non Conforming Lender
- Why is a Good Credit Rating Important in Australia?
- Most Common Ways That People Fall Into Personal Bankruptcy
- How to Choose a Consumer Credit Counseling Agency?
- Consolidate Your Debts and Take Control of Your Finances
- How to get a Home Loan due to a Bad Credit Report
- Debt Consolidation Home Loans are a Solution to Multiple Debt Problems
- Facts You Should Know About Low Doc Home Loans in Australia
- No Doc Loans from Private Lenders
- Home Loans to Consolidate Debt for People with Bad Credit
- How Can I Get a Mortgage If I Have a Bad Credit History?
- Guidelines to Fix Bad Credit Effectively Through Dispute
- Dealing with Debt – What to know about Debt Consolidation
- Investing In Yourself Before Investing in the Market