Why It’s Important to Read the Fine Print

Do you ever stop to consider all of the papers that you receive in the course of your daily life, but which you do not stop to read? Do you read the warranties on every product you purchase and the terms and conditions on every website that you visit? Do you even bother to read every cash register receipt to confirm the time that a store allows for returns?

I didn’t think so.

We are inundated in paper and verbiage every day. We receive notices and policies and invoices in the mail. We receive packing slips, receipts and other documentation with our purchases. We find ourselves signing contracts and other legal documents. We should read them all, but we don’t, and that can cost us.

For example, I moved into my home in 2000. My wife handled most of the transaction. She told me where to sign. I signed. It underscored for me the wonder of my wife because she was willing to deal with all of the papers and she only needed my presence for about ten minutes. I signed the closing documents, as directed, and then I went back to a conference. When I got back from the conference, I was a homeowner.

Unfortunately, I was not an informed homeowner. I did not read the covenants that our homeowner’s association required us to accept. As a result, I did not know that I was not free to landscape my yard however I wanted. Accordingly, I spent a summer having my front yard re-landscaped. I did some of the work myself and I hired some gardeners to help me with the rest of it. I spent a lot of money – over $4,000 including the cost of the plants.

Silly me. As I now understand, when one lives in a suburban subdivision, it pays to know the covenants that all homeowners are required to accept. I did not and I fully realized that about a month after I finished landscaping. Our homeowners’ association sent me a nasty-gram threatening me with legal action if I did not change my yard back to how it looked before I landscaped. Why? Because in my subdivision, a homeowner can only make material changes to his or her front yard if he obtains the approval of the architectural review committee of the association.

Who knew? (Don’t answer that. It is a rhetorical question because, I know, I was supposed to know.) In any event, to make a long story short, I fought with my subdivision for about 6 months and eventually compromised by tearing up a portion of my landscaping and replanting grass. Sadly, the area that I tore up and resodded had cost me about $2000 when I did my first re-landscaping. Thus, I had cost myself $2000, and six months of aggravation, because I did not take the time to read the documents that I had signed when I bought my house in the first place!

If you take the time to read the fine print in almost any document that you obtain as part of a purchase, you will find that there are often hidden costs included in them. Yesterday, I almost subscribed to a magazine because I received an advertisement indicating that I could subscribe for $1 for three months. That seemed like a worthwhile deal, so I filled out the on-line subscription form and then noticed – in really tiny print – that my subscription would automatically renew for one year and I would automatically be billed $39.99 in three months unless I cancelled the subscription first. The magazine seller knew that I would never remember to cancel and was willing to give me three months so that it could capture me for a year. Fortunately, I read the fine print this time, and I never submitted my subscription.

Taking the time to read the sales documents that we receive can save a lot of money in the long run, but at a cost of a lot of time, tedium and mental toil. How do you decide what you will read? Do you save all of your documents in neatly organized files or do your receipts and warranties and invoices go into the trash as soon as you receive them. I assume you do keep the major agreements that you sign, but do you always read them first?

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8 Responses to Why It’s Important to Read the Fine Print

  1. Jay Gatsby says:

    Very expensive lesson. HOA covenants can be a pain, but they do serve a useful purpose. If you don’t comply, you will get sued by the lawyer the HOA has on retainer. You can fight the suit, but it will cost you far more in legal fees than it will to simply fix your yard.

  2. Ann says:

    At the closing of my current house, I found out that I was part of a subdivision. Among other things, the covenant called for no more than two dogs or cats per resident. I laughed and made jokes about it because I don’t have any pets… and actually thought it was a great idea!

    When I was planning on ripping out a hedge, putting in a brick patio and a fence, I looked for a copy of the “rules” in my closing papers. It wasn’t there! So I had to call my closing attorney and ask for a copy. Luckily, there was nothing in there about what I wanted to do and only had to pursue a fence variance from the city (a 4 month process).

    This was the only document that was read out in total at the closing and I’m glad that it was ’cause it put me on notice to check before I did anything major. At house closings, I rely on my attorney for a thorough review of all the “normal” paperwork and was glad that this was recognized as something a bit different.

    I recently ran into something interesting with the credit card I generally use. I keep this card because, for on-line transactions, I can generate a “virtual” account number that is only linked to my “real” account on the bank’s computers, which gives me an added level of security. Well, one place I purchased something at, not only sent me and charged me for what I ordered, but (a few days later) charged me a web access fee to the same virtual account number. I called the credit card company and the seller reversed the charge… only to charge me twice as much a few days later for some membership fee! I called the credit card company again, they took care of it and this time I asked if there was a way to cancel the virtual number. They hooked me up with a techy expert and, in my case, the news was fantastic! Not having read the fine print, I hadn’t been aware that, not only could I cancel a virtual account number so it couldn’t be used again, but that account number could only be used at the company I made the original charge with. On top of that, it turns out that, when I make a charge, I can set the “virtual” account to accept only a specific dollar amount, after which it is invalid and/or change the valid through date! I was extremely grateful to the tech for the information he provided and wished that I’d been aware of these features before I had a problem…. and would have been, if I’d ever bothered to read the fine print when I first signed up! LOL

    Fine print can have helpful information, as well as restrictions, and I’m now much more aware of that fact.

    One small question, David — why didn’t your wife stop you? Looks like she didn’t read the fine print either! I realize that you probably figured that, being an attorney and having an intelligent wife, you didn’t need to “waste” the money to hire an attorney for the closing, but a good real estate attorney might have pointed out the subdivision restrictions and helped you avoid the problem in the first place. What’s that old saying? Oh, yeah — “Haste makes waste.” LOL

  3. Texas Girl says:

    You all are probably too smart to fall for this one 🙂 but in addition to READING all the fine print, make sure everything you sign has every single blank filled in. When I was young and dumb and fresh out of college, I rented this apartment from a ‘sweet old lady’ who had me sign a blank lease. She was SOOOOO sweet, and told me YES, I could have a dog, etc., etc., because she ‘wanted to rent to good young people like me.’ Well, come time to move out, surprisingly enough HER copy of the lease was all filled out saying I COULD NOT have a dog after all or I would lose my $600 deposit, and furthermore got socked with a bill for replacing the carpet and the cost of repainting, because I had ‘agreed’ to that in the lease. I had huge (for me) debt for the first time in my life, because I didn’t realize that I should have had all that in writing and NEVER signed a document with blanks in it. I’m a lot smarter, meaner, and less trusting now thanks to getting fully taken advantage of by a nice old lady.

  4. Spicoli says:

    Reading every fine detail is important and is a money saver – but that’s what i have my wife for.

  5. Steven says:

    Like the old saying goes, “The big print giveth and the small print taketh away”.

  6. Sheena says:

    That’s really very informative and true.
    Most of the time we tend not to read the fine prints that are written in the documents and just sign them.
    This can cost us greatly and later we may land up in some serious trouble.
    We know this fact but still we take the fine prints for granted and ignore them.
    Let’s promise to remember this and read the document carefully as far as possible and then go about signing the documents.

  7. Persephone says:

    I totally agree. I learned this lesson the hard way. I bought two warranties for the same appliance (I won’t bore you with the details). I did so because I didn’t have a filing system. Luckily I was able to cancel the second warranty (after much hassle).

    I now have a filing system. Lesson learned.

  8. Persephone says:

    I just read that President Obama did not read the stimulus bill (or even get fully briefed on it) before he signed it. I wish he had read this article before he signed . . . .

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