The fact that many of the most blatant offenders operate out of South Dakota and Delaware is no coincidence. Those states have more relaxed consumer protection laws and let banks raise interest rates and fees to levels that are illegal elsewhere. If you are a student with no income or have recently emerged from bankruptcy, credit card solicitors would like to talk to you. They know that the recently bankrupt can't declare bankruptcy for another six years and that Junior probably doesn't know the first thing about budgeting. Out of the blue you find one.
Some lenders start charging an annual fee to their customers who pay their bill off every month.
The maxed-out customer is then charged an additional fee for being above it. A variation on this theme is to simply lower the customer's credit limit once they reach it. Also watch out for transaction fees for calling the toll-free number to check your balance, and penalty fees for account inactivity. Remember, if your grace period is eliminated, you'll accrue interest from the day you make a purchase. The only way to avoid a finance charge would be to pay your bill before you received it.