We all know that credit card companies are out to get as much money as they can from us, where late fees, over-limit fees, and transfer fees are just a few of their tricks. It is also possible that not only do you have to pay these additional fees, but it is possible and legal that the credit card company may raise your interest rate - overnight.  Surprisingly, they can raise your interest rate if you've made a late payment on any of your other cards, including those issued by other companies.

As for late payments on car loans, mortgages, and even phone bills, the numbers are even more astounding. If your credit card issuer is one of the 40% of companies that partake in raising interest rates, they may raise your interest rate up to 30% or more.  And it’s entirely legal. If you look ever so closely within the fine print of your credit card agreement, the universal default clause explains it all.

A universal default clause states that a creditor reserves the right to penalize you with an increased interest rate if you're late, whether to them or whether you’re in default of a payment to any other creditor. The universal default clause is justified in part due to the fact that if you pay any of your creditors late, you pose a greater credit risk and are less likely to pay your debt.

Your creditors also have the right to routinely monitor your credit file. So a creditor with a universal default clause will be watching -- and waiting. If your credit card is a carrier to the universal default clause, such as a specific Visa card you have, any late payment  (whether it's on your utility bill, home equity loan, or Macy's credit card)  acts as a "default trigger" allowing the bank that issued the Visa card to double or even triple your interest rate. At the end of all of your worries, your credit score will also be hurt.

The top triggers to watch for to protect your current interest rate from dramatically rising are a decline in your credit score, a late mortgage payment, and a late car loan payment. Under the universal default clause, your interest rates can also be increased for several other reasons, including exceeding your credit limit, bouncing a check, having too much debt, having too much credit, getting a new credit card, applying for a car loan, and applying for a mortgage loan.