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24.99% interest rate on some credit cards if you miss 2 payments in a row -- it can go up to 27.99% for missed payments on cash advances....

Time to consolidate.

An interest rate of 21% sounds high but it will seem like a bargain to some Toronto-Dominion Bank credit card customers when it climbs to 24.99% at the end of next month.

Credit card debt has always been among the most expensive ways to borrow, largely because it is unsecured and traditionally comes with a much higher default ratio.

In the world of credit cards, being considered in arrears amounts to not meeting the minimum payment, which in most cases is 3% of the outstanding balance every month. Three months of not making payments puts you in arrears, according to credit agencies.

That type of non-payment will also put a bulls-eye on your head as TD will now charge the higher interest rate when the minimum payment is 30 days past due on its TD First Class Travel Visa Infinite card.

Customers are notified in their next statement that they have missed that minimum payment and must pay up or higher rates will be in effect on the next payment cycle – in other words, two missed payments in a row and the rate goes up. It climbs to 27.99% from 21% for missed payments on cash advances.

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