A new national survey released today reveals that consumers know very little about the credit cards they use most often, including annual percentage rates (APRs), credit limits and basic credit card fees. The survey, conducted by Princeton, New Jersey-based Braun Research, was released by personal finance expert Lynnette Khalfani, author of the New York Times bestseller Zero Debt: The Ultimate Guide to Financial Freedom.

The survey results suggest that some of the problems may begin with the credit card offers consumers receive in the mail. Nearly one third of the card holders surveyed said they either don't read or don't understand the fine print contained in mail offers. More than 20 percent of respondents had trouble locating pertinent information, such as the APR being charged on a credit card.

The good news is that consumers want more information. A full nine out of ten consumers say that they want banks and other credit card issuers to highlight the fine print in their mail offers and make them clearer and easier to understand.

"Consumers are crying out for better disclosures in credit card solicitations," said Khalfani. "Credit card offers with excessive legal terms, and tiny or hard-to-find fine print cause confusion and lead to poor financial decision-making," said Khalfani. "Improved transparency will help Americans comparison shop and choose credit cards that are the best fit for their financial situation."

The most troubling findings of the survey revealed:

* Nearly 44 percent of respondents did not know the APR charged on their

credit cards, and 20 percent of card holders did not know their credit

limit.

* Nearly 7 out of 10 people surveyed said they didn't know whether being

late on a payment to another creditor could cause their credit card

company to hike their interest rate, suggesting that a vast majority of

consumers are unaware of the "universal default" clause present in most

credit card agreements.

* When asked what information card holders would most like included in

credit card offers, nearly 40 percent said they want clear terms and

information outlining the specific actions that can cause credit terms

to change, such as paying a bill late or going over a card's credit

limit.

* Consumers are not taking the time to shop around to find the best card

to fit their needs. More than 40 percent of the card holders surveyed

simply accepted the credit cards that were offered to them without

comparing it to any other offers.

"It is amazing that nearly forty-four percent of credit card users don't even know the interest rate on the credit cards that they use every day," Khalfani remarked. "Understanding how to use your credit -- and how not to use it -- is a lesson you don't want to learn the hard way. As a critical first step, consumers need to understand the terms and conditions of the credit cards they are being offered."

Khalfani says the most important thing consumers should do when evaluating credit card offers is to read the fine print. She also offers consumers these tips to understanding and evaluating credit card offers.

* Contact the credit card company: If you don't understand a term or

stipulation of a credit card offer, contact the credit card company to

ask for a "plain English" explanation.

* Comparison shop: Use online research tools like Bankrate.com to

comparison shop for the best credit card deals.

* Compare your credit card offers side-by-side: Put your credit card

offers side-by-side so you can look at the Schumer Box on each and do an

apples-to-apples comparison. Some companies like Capital One break out

the most important information into an easy to understand chart -- so

that card holders know exactly how their actions can affect their APRs.

* Review APR rates, grace periods, and relevant fees or finance charges on

all of your existing credit cards: Pull out all your credit card

statements and check these basic terms on each.

* Don't accept a credit card offer based solely on the interest rate

offered: It could have other terms or drawbacks that make it less

attractive.

* Review credit card account statements to see if your credit cards

contain a "Universal Default" feature that reserves the right to raise

your interest rate if you make late payments on other debts: Read your

card issuer's terms carefully and consider switching to an issuer that

doesn't use a Universal Default clause.

For more information, please contact Alison Athay at aathay@apcoworldwide.com.

About Lynnette Khalfani

Lynnette Khalfani, The Money Coach, is a personal finance expert and the author of Getting to Your First Million (McGraw Hill; July 2006), Investing Success: How To Conquer 30 Costly Mistakes & Multiply Your Wealth! and the New York Times bestseller Zero Debt: The Ultimate Guide to Financial Freedom (Advantage World Press). Lynnette is a popular speaker to individuals and organizations across the country that want to be educated about credit and debt management, investing and entrepreneurship. Lynnette is also a frequent guest on national TV and radio programs, and has been featured in numerous print publications, including the New York Times and USA Today. Visit her website at http://www.TheMoneyCoach.net.

Survey Methodology

Braun Research was engaged to conduct 1000 interviews with adult credit card holders, 18 years of age or older across the United States. Surveys were conducted by telephone from March 10th through March 12th, 2006. The incidence of this study was 68.6 percent requiring 1458 households to be screened. The margin of error for the interview is plus or minus 2.56 percentage points. Interviews were monitored at random.

Sampling for this study was conducted using a national probability sample of all exchanges and area codes across the United States. All interviews were conducted using a computer assisted telephone interviewing system. Statistical weights were designed from United States Census Bureau statistics.

Source: prnewswire