Many credit card holders have no idea how easily one mistake, intentional or not, can cause a huge increase in your interest rate. With an increased rate, it can quickly become near impossible to keep up with your credit card expenses, especially if you continue to make use of your cards.

So what does it take to jack up the interest rate on a credit card? Hopefully a better understanding will help people stay on track but you can’t say we didn’t warn you.

First, let’s talk about the penalties.

Penalties can increase from a 0% or other low interest rate to a whopping 31.99% rate after only one mistake. Typically the average penalty rate is 26.87%. Penalty rates are also called default rates because essentially the credit card company you have an account with made you sign an agreement when you opened an account. In the agreement, you promised to pay your bill on time, each month. When you slip up and have a late payment or some other penalty trigger occurs, you broke your promise to the card company. Thus, the credit card company is entitled to penalize you for that broken promise and they are not shy about hitting you where it hurts - the wallet.

There are three common actions (or inactions as the case may be) that can cause the default rates to take over. Avoiding the following triggers can save you a lot of hassle and even more money over time so it is important to avoid making these mistakes at all costs. Once the default rate kicks in, you are stuck with it unless you can convince your creditor that your loyalty over the years exceeds the one mistake you made by paying during one month.

Here are the three common default rate-inducing actions:

1. Going Over Your Credit Limit

This one is a double whammy. When you go over your credit limit on your credit card, not only can the default rate kick in but the credit card company will hit you with over the limit fees too. Cardholders need to be very careful because the in the event your card gets the default rate tacked on for a mistake, that action can also put an unsuspecting cardholders balance over the limit.

That is why it is so important to review your statements each month, no matter how painful, just to make sure that everything is on the up and up and you have a clear understanding of how much you owe.

2. Make Just One Late Payment

Credit cards are nothing like baseball - where you get to make three strikes before you are called out. With credit cards, it may take only one strike before the default rate is added to your account. It doesn’t matter to them if your payment is one day late or one month late.

Not all credit cards will penalize at the first missed payment but many are changing the rules. Check out the fine print of your original credit card agreement to understand the terms of what late means and avoid being late or missing a payment at all costs.

3. Insufficient Funds Hurt

Adding insult to injury, a credit card company will hit you with a triple whammy if you bounce a check you sent in for payment. First, you are likely to get hit with the default interest rate penalty.

Second, you will be penalized for essentially missing a monthly payment and face additional fees.

Third, you will get hit with up to an $80 fee for insufficient funds in your bank account from the credit card company. Oh, and you can’t forget about what your bank will charge you for the returned check.

If you do or have made any of these mistakes in the past and they were honest mistakes, the worst thing you can do is ignore the situation. There is no harm in picking up the phone and talk to a representative at the credit card company and see how you can make amends and get your rate lowered. If you do get a second chance, you will need to work even harder at paying on time, every time.