Watch Out for Tricky Credit Card Charges and Fees

Credit card billing statements can contain unwelcome surprises. That's why I take a few minutes on the last day of each month to go over every charge. To make the process easy, I've put my credit cards on a billing cycle so they all arrive at roughly the same time. Yes, I like to keep track of what I'm spending, where I'm spending, and whether that auto repair charge is as big as I remember. But I'm also on the lookout for what I call "snipe charges."

Hey, what's this charge?
Snipe charges are those that somehow slip onto your statement from time to time without your noticing. Maybe you have a recurring subscription that you forgot to cancel. Maybe you signed up for something on the Internet and in teeny-weeny print somewhere it said you were also signing up for some crazy DVD club.

I recently realized that certain unscrupulous smartphone apps will generate in-app purchases that come out of nowhere. A friend told me about signing up for a merchant account so he could accept credit cards, and mysterious compliance fees began showing up every month.

Other charges to look out for include gym memberships. For many years, one national gym chain made it practically impossible to cancel a membership and kept charging cards by the thousands.

As for me, anytime I sign up for a subscription, I enter all the relevant info into a spreadsheet. I also set an alert on my smartphone if it's a trial plan and I don't want to get hit with the monthly charge when the trial period ends.

A CARD Act to follow
As for credit card companies, before the CARD Act of 2009, they were virtually unregulated as far as what fees they could charge. But the legislation put certain requirements in place. Previously, if you wanted to pay by phone or online, you could get charged a fee, and you'd also get an over-the-limit fee if you exceeded your credit limit. Now you must opt in for the fees. If you don't, a charge for the fee won't go through.

In addition, if you had a card that carried balances with multiple APR rates, the issuers previously would apply payments to the lower-APR balances first. As a result, you'd get hit with more interest fees, because higher-balance APRs wouldn't get paid down first. Now, any payment over the minimum is required to be applied to the highest APR.

It never hurts to speak up
Regardless of whether a mystery charge appears to be from a merchant or your credit card company, you should always challenge it. There is nothing to lose from challenging the charge. For starters, if turns out to be a sketchy charge, you have leverage in reporting the offending party to consumer activist websites and the FTC and blowing that party's name all over the Internet. You can tell the offending party this, too. Even if the charge is legitimate, you may find that it still gets waived. I've had instances in which all I did was ask about a charge that I simply didn't understand, and because I have such a great relationship with my issuer, the issuer waived it. "If you don't ask, you don't get," as a friend tells me.

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