Americans love credit cards. Consumer credit spending is an integral part of the American economy, with people seasonally spending on holiday gifts and vacations and then slowly paying their balances off.

With the exception of introductory rates where someone is paying little or no interest, carrying a balance on a credit card is a decision that can quickly lead to unexpected expenses and even unsustainable levels of debt.

You might think that credit card companies prefer to lend to people who have impeccable borrowing habits, but the opposite is generally true. Credit card companies can make a lot more money off of someone who has a high balance and may make minor mistakes, like sending out a payment late.

Fees and penalty interest rates can bring in significant income

Every credit card has its own exact terms, but many companies charge returned payment fees, overlimit fees, late fees and even annual fees just to maintain that line of credit. Those fees are all in addition to payment made on the principal balance and the interest that rapidly accrues.

When you exceed your authorized credit limit or when you make a late payment, it could trigger the penalty interest rate, which could be substantially higher than the rate advertised when you first signed up. You could go from paying a 0% introductory interest rate to well over 20% because you mailed out a check just a few days late.

The longer you take to pay something off, the more it costs you

Credit card companies compute interest in a way that maximizes their income. The longer it takes you to pay off the balance of a big purchase, the more money they make on that transaction.

Companies love to finance big purchases that take months or even years to pay off. By the time you finish making the minimum payments on a big purchase, you can pay more than double the ticket price for that item.

Credit card companies aren’t patient when you fall behind on payments

While all the big credit card companies do like people to carry high balances and incur fees, they don’t like not getting their monthly payments. If you have missed your monthly payments for one or more billing cycles or if you have made payments under the monthly minimum amount, the credit card companies that own your account may soon start to take collection action.

Credit card collection efforts could include taking you to court to seek a garnishment of your wages or otherwise compel you to pay. You can defend against credit card lawsuits, although you must act quickly to avoid getting into an even worse position.