NOW's correspondent talked with Tamara Draut of DEMOS about what consumers should know about credit in America today. Below are edited selections from that interview.

Low Introductory Rates and the Fine Print
Most credit cards, they have zero percent six months, 12 months. Then you're bumped up to something more reasonable like 7.99 percent. But built into that is the ability to change the rates at any time. In the little sheet of paper that explains the rate and fees that comes with the card in bold type it says: "We reserve the right to change the terms, including the APRs, at any time, for any reason."

The "Grace Period" on Payments
In the 1980s, actually, it used to be that most credit card companies provided 15 day grace period before they would assess any fees or raise your interest rate. Today, if your payment arrives a minute after a two o'clock deadline. You can see your rate triple, quadruple, and you're easily going to be paying 29 percent or more on your credit card. Most people say now you should try and get your credit card payment in at least a week before the due date, because that's the only way to ensure that it's gonna actually get there on time.

We do know, according to different surveys, that about 40 percent of cardholders report that they've paid some sort of late payment in the last year. Which means a portion of that 40 percent have probably seen their interest rates jacked up into the high 20 percentage range.

Credit Limits
You go over your credit limit. [The credit card company] approves the transaction. But then they sock you with a 35 dollar fee for going over the credit limit even though they approved the transaction.

Universal Default
What [universal default] means is if you are late to any other creditor, you can all of a sudden have your interest rate jacked up on a card that you have a perfect payment history on. And again those rates are 25 percent, 27 percent.