1 Way To Avoid Credit Scams

Most people don't realize how common Credit card scams are. Many companies target the consumers with less than perfect credit or those with badly damaged credit. For those consumers companies are not banging down the door to offer you a credit card with a great deal.

Scams using credit cards are far more common that most people realize. The companies will make you an offer that sounds very legitimate but most times they include outrageous annual fees, very high interest rates, or other odd terms.

There are a number of different companies out there that mail out pre-approved credit card offers, which are disguised as valid MasterCard or Visa's. In reality, these types of credit cards are for catalogue clubs or store clubs. The credit card offer informs you that you have been pre-approved for a line of credit, with no security deposit, for up to $5,000. Such companies give you a sense that you are repairing your credit, all the while, allowing you to get a taste of the convenience of carrying around your own credit card.

When you don't have good credit you might want to rush in when you receive a credit offer in the mail. But remember that if it sounds too good to be true then it usually is. When you receive these types of offers in the mail it is very important that you read all the fine print. Before you sign up for anything look over all the terms for the credit card very carefully.

Such credit card scams tell you that you are pre-approved for a MasterCard with a $5,000 credit limit. They inform you that you simply need to verify your personal information in order to activate the card. In order to verify the accuracy of your information, they ask that you sign the credit card offer and mail the application back in. Afterwards, your credit card will be mailed to you promptly.

If you have carefully read over their documents you have realized that this is not a regular MasterCard. This card is limited to purchasing items that are from either their online store or at a special online catalogue. You will not be able to purchase anything else by using this card. Meaning you cannot go to a local restaurant and charge your meal. What the online stores generally sell is off brand products like electronics or household items.

The usual catch to the scam can be found by further reading the offer. They usually require you to mail them a money order for $299 to activate the offer. They usually offer reassurances that you will get that money back with special offers or discounts from the company when you make your first purchase on your new credit card. Annual fees of additional hundreds of dollars are also added to the credit cards by some of the companies out there, and that is on top of the of the extremely high activation fee. Hopefully the more you read the less appealing the offer sounds.

Most of these types of credit card offers will charge you upward of 45% interest, which is obscenely high. So it is vital that you have read all the information contained in credit card offers.

One of the best things you can do when you receive an offer like this, is throw it away. Instead, use the money it would take to activate the card and spend it on obtaining a secured credit card. With a security deposit, you can easily obtain a MasterCard or Visa. This is a great way to begin repairing your credit, since such companies report to the major credit bureaus. Be sure to keep all of this in mind the next time you walk out to your mailbox and see a credit card offer waiting for you.

By: Darren Allsop..

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