Mail offers may mean more credit card debt for consumers

Banks mailed out more than one billion credit card mail offers in the first half of 2010, specifically targeting consumers with good credit. Issuers have marketed aggressively since the Credit Card Accountability, Responsibility and Disclosure Act rolled out on August 22. The legislation limited some of their crucial means of profit, such as high interest rates and penalty fees.

Many mail offers tell recipients they have been pre-approved and are eligible for no annual fees, but according to the Wall Street Journal, not all issuers are being honest. Experts say a number of these offers are traps, aimed toward locking unsuspecting consumers into new credit.

Industry analyst Beverly Blair Harzog told the newspaper that while these offers may emphasize they help members build credit history, all cards do this. Things such as fraud protection and future credit line extension are also standard with any card, meaning there is no reason to treat these mailed ads like special offers, Harzog says.

Prior to signing up for a new card, consumers are encouraged to read all of the terms and conditions. While some of these reward incentives may be true, rates and fees are often hidden in the fine print.