I think annual fees have become a joke. They used to be between $29 and $39 per year for a $1,500 credit line. Now they have cards that charge an annual fee of $100 per year for credit lines of only $300. I think it is more important now than ever before that people getting new credit cards should read the fine print, especially about annual fees.
It is something similar in the UK too, I don't understand how they can justify such high amounts for such a small line of credit. Another sign that the banks are really wary of lending money to people, when the economic crisis was basically the result of banks encouraging people to lend beyond their means and then yanking the lines of credit from them, not necessarily people not paying. It annoys me.
I avoid getting cards that have annual fees. I just don't think I should have to pay those. I'm already paying crazy interest fees when I use the credit line, so I don't feel like I owe them any more than that.
I would like to say that I will avoid them, but in reality, I am in the process of getting rid of ALL of my cards. The first ones to go are the ones that I described, with high annual fees and low credit lines. As much as I need the money, I do not need it badly enough to pay $100 for a $300 credit line. We only got these cards because I was making less money at the time, and we temporarily needed more credit.
I believe that what you are describing happened to me several years ago. I had a Discover card with a $15,000 credit line. I had just sold some things that I really did not want to part with in order to pay the card down to about $10,000. The next morning, I got on the computer and saw that they lowered my credit line to $10,000. When I called them, they said that they just reviewed my credit score and were doing this across the board. If I remember correctly, Obama eventually put a stop to credit cards lowering credit lines without letting the customer know before hand, because people on vacation suddenly were stuck in the middle of nowhere with no money.
I have several cards. None of them have fees. I had one card that forgave the fee for the first year and then when a charge came due I changed it to a different card with the same financial institution. As I said, I have more than one and no fees. I have some that are specific to a retailer or chain. Some may maintain that the fees cancel out with the special benefits of that particular card. Myself I opt for the 'no-fee' package. Oh and I do have a line of credit as well. Ryder13
Annual fees are really a pain but there are ways to lower it or not pay it at all. Usually your credit card company will have a rewards system and if you use your credit card often enough you will be able to save enough points to "pay" for your annual fee using those points. I've also found that depending on your credit card use if you call customer service early enough and ask about what you can do to lower the fee they'll be nice enough to give you a discount.
I only have 2 credit cards. They are both reward cards. The first one I got has an annual fee of $39 - but I think, throughout the year, I get more than that back in cash back rewards. My second one is an Amazon.com Chase card. Luckily that has the higher credit limit, a reward system, and has no annual balance. At this time, I am not looking for another card - but my next card will 100% be a no-fee card since I haven't noticed a true benefit of the $39/year card compared to the no annual fee card. Unless for some reason the cash-back system, reward system, or the benefits of the card justified the annual fee, I don't see a reason that I should pay a fee. Fine print is especially important. Good point to add. Commercials and advertisements can lure a person in - and that person may not even know what they're about to get themselves into. Fine prints will also talk about terms and conditions, what interest rates are, what annual fees are, etc. - which may be things that aren't so out in the open when you first apply for a card.
