All those holiday bills could cost way more than expected if you don’t keep an eye on the latest rule changes at your credit card company.

First, let’s look out for those Grinchy late fees. They’re getting nastier and nastier.

Bank One notified credit card customers that they soon will face a $39 late fee if they have a new balance of $250 or higher. And, of course, a $250 balance is pocket change after a wild holiday shopping spree.

Until this switch, many Bank One cards had a $35 late fee. Customers might still pay a $15 late fee if the balance is less than $250.

Or they could be charged $39 no matter what the balance if they’ve paid late a few times in the past. Some card holders will see the $39 fee this year; others will see it early next year.

A $39 late fee? Gee, it was six years ago when I was griping about late fees climbing to $29. And now they’re headed up from $35 to $39.

What I love is that I’ve never actually seen one credit card notice spell out the new fees. The legal-looking paperwork just lists terms. It’s up to you to dig out an old statement or go online to the credit card’s Web site to compare the old rules with the new rules.

Track down fees

Talk about customer-friendly. It’s no wonder that many people never realize that they are looking at fatter fees or higher interest rates if they make a mistake and pay late. Sure, they were notified of the changes, but the notices were buried in tons of fine print.

So my suggestion is that everyone who uses a credit card spend some time on the phone – or go online – in the next week or so and get the credit card issuer to tell you exactly what you’d pay for various fees.

And if you don’t know your interest rate, find that out, too.

The average variable-rate card was 13.5 percent last week, Bankrate.com reports.

But if you have a good credit history, you should be paying about 10 percent or less, according to Greg McBride, senior financial analyst for Bankrate.com.

While you can always shop around for lower rates, I think it’s just as important to know what fees you could be charged.

What would you pay, for example, if you wanted to make a last-minute payment by phone?

I called up my credit card issuer and discovered that I’d be charged $14.95 to pay by phone.

The charge would be billed to my next monthly credit card statement.

Watch for default rate

Do you know how high your interest rate could go if you are charged a default rate? I was told I’d pay 28.99 percent.

Think you’d never default?

Well, think again.

You could pay a default rate on your credit card if you exceed your credit card limit. Or if you’re late with your mortgage or car payment. Or if you’re late with just one or two credit card payments.

Bank One also told customers that the default rate soon will be as high as 23.99 percent plus the prime rate.

Now, prime is 5.25 percent.

So the new default rate would be 29.24 percent instead of 26.24 percent.

The prime rate is likely to go up in 2005, too. So default rates – along with other variable rates – could head higher.

Yes, if you run into trouble, you might be able to sweet talk your card issuer into charging you a lower rate than the top default rate.

But even if it caves in once, it could increase your rate in the event of any future default. Remember, they hold all the cards.

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(c) 2004, Detroit Free Press.

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AP-NY-12-22-04 0615EST