Top 10 Fine Print Gotchas

Being a smart consumer, or smart investor, or smart anything really is all about knowledge. Understanding the world you are playing in just makes good sense. I can spot most finance scams by reading the title. The reason? I’ve spent plenty of time reading the fine print and have grown accustomed to what fine print goes with that BLARINGINGLY GOOD TITLE!

So, without further ado, here are the Top 10 Fine Print Gotchas:

1. That’s Not It
   • One of the most common fine print gotchas is when the really great picture you see isn’t actually what they are talking about. For cars you’ll see a fully equipped XJT9X version in the picture when the ad is talking about the base no-options model. For others, the fine print will point out that the picture is only “representative” of the product, meaning it is pretty much like that, but not just like that.
2. Rebates
   • The one I really hate these days is rebates. Electronic store ads are filled with them. A great deal on a monitor for $199? Sure, but you will pay $279 today. Then, you can get a rebate from the store (but it’s an “easy” rebate) for $40 and then you can get another rebate from the manufacturer for $40, but only if you also buy Wango Wicket Adventures (at full price.) The car guys get you here too. $199 / mo. — of course you’ll need the recent graduate rebate, and the military service rebate, and the astronaut rebate…
3. Fees
   • For this one I’d like to give a big welcome to the cell phone companies. $39.99/mo. for 500 minutes, but (super fine print) it doesn’t include fees and taxes. The real burn here is that the fees are phony charges that get official sounding names (usually copied from real land-line phone bills.) The tipoff for this fine print gotcha is to find the words “Does not include…” Also watch for it on anything where you can be charged for delivery or setup.
4. You Aren’t Just Buying One
   • $9.99 is a great deal. Too bad you will only pay that for the first one. In this fine print gotcha the price is actually the price of a subscription to buy several more full priced ones. Watch out for a purchase that requires a credit card or your billing information. If you can’t buy one for cash without giving anyone your name, then you are signing up to buy a bunch more. Look for fine print like “Purchase enrolls buyer in…”
5. It Won’t Work…Until You Buy Our Service Too
   • The fine print here will inform you that you are buying a very expensive doorstop that is until you “activate” it. Your fine print tip-offs are “must be activated…” or “requires subscription…” or “requires service…” A cell phone is an obvious example. Others include T.V. recorders, XM radios, OnStar, and so on. Watch out because the fact that you have to buy expensive monthly service is often hidden by a free “trial” period. Then, watch out for the next one.
6. Well It’s Free Now…We Won’t Tell You When It Isn’t
   • This one catches tons of people. An offer for a service, the service costs money. No problem, you can try it free for 90 days. The fine print? They won’t ask you if you would like to keep it for 91 days. In fact, the only way you can have the free trial is if you give us your credit card information, so we can keep billing you after you forget to cancel your free trial. I get calls all the time from people who bought cars with satellite radios. They came with a 12 month free trial. When they notice they are paying $19.99 a month for their radio they freak out. “Oh, the trial period ended,” followed by my favorite lie in all of corporate America “We did it for you.” “As a service to ensure our customers get uninterrupted service we automatically…” — Beat this one with a Savvy Credit Card Trick.
7. We Don’t Have Any…But Buy Something Else
   • Most commonly associated with Sunday ads. The super great price for the fax/phone/deep-fryer? The fine print says “Limited to Quantities in Stock” or “No Rain-Checks” followed by “In-Store Only”. You are there when the doors are unlocked Sunday morning and it’s already sold out? Oops. Stocking error. You could try the store all the way across town.
8. It’s Not A Deal At All, But We’ll Hide The Price For You
   • Common on anything that you make monthly payments for, this fine print explains that you aren’t really saving any money, instead they are charging you per month instead of upfront. The mortgage and home equity guys love this one. No Closing Costs! Fine print=closing costs financed into loan. Look for tip off words like “costs financed” or “lower rate may be available.”
9. Sorry Mr. Gates. Your Credit Isn’t Good Enough
   • Dealing with banks or lenders brings out this one. $199/mo. only if your credit score is higher than a home-schooled genius on the SATs. This one comes with fine print abbreviations “W.A.C.” means “With Approved Credit”. Guess who gets to decide if you are approved?
10. Dear Long-Term Customer, We Hate You
    • Hello, Cable and Satellite companies! Perhaps the most misguided marketing technique in recent memory. Hey, there is a great deal at my favorite shop? I love going there! I’ll go down today and get that great deal! Sorry Charlie. This deal is “For New Customers Only”. In other words, we are hoping our low price gets someone to try out our stuff so that we can charge them what we charge you later on! Most common deal right now is the $99 for phone/Internet/cable from Comcast, Qwest, AT&T, Verizon and so on. Fine print tip offs: Look for a definition of what a new customer is. “Must not have used Super Great Service in past 12 months.”

There you go. Top 10 Fine Print Gotchas. Hope it saves you some money and aggravation. The trick is to always skim that small text at the bottom. Keep in mind the trick to make the first line of fine print really complicated sounding, and not very important. This is so you assume the rest isn’t important. The most important fine print is probably the lines in between the first and last fine print points, so definitely make sure you read those.