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| More rates and news from Look At Fees And Interest When Applying For A New Credit Card
(Whenever you take out a new credit card it is important not to be blindsided by their seemingly fabulous introductory offers and benefits. )
Credit card companies will sometimes offer flashy giveaways and other promotions in the beginning terms of a credit card to secure new borrowers, only to hit them with tremendous fees and other costs later on down the road.
That is why it is important to do some research on the specific credit card you are getting and understand exactly what you are getting yourself into before utilizing your new piece of plastic.
An article posted on homemoneymanager.com by Bob Malone, “Credit cards – Keeping fees and interest to a minimum,” discusses some various parts of a credit card offer that consumers should review before applying for and using the card.
“Every month there seems to be a new type of credit card launched on the market, with must-have features and never-before-seen offers. Although some of the new features may suit your personal circumstances, it is always good to come back to basics to find out what the credit card will really cost you.”
The first thing to take a good hard look at is the terms and conditions of your new credit card. This will tell you all about fees and the interest you will be paying. Getting a credit card that has a relatively low interest rate is essential to a healthy credit score. You should also know that if you make a late payment that your interest rate will probably raise on this card and it could also get raised on any other cards you have as well.
“Make sure you know what, when and how you will be charged fees and interest. The credit card provider will go to great lengths to point out how low their introductory rate is, or the benefits you receive through their reward schemes, however the real costs and charges are often hidden in the fine print.”
“Read the credit card terms and conditions carefully (and any notices you receive of changes to your agreement). Although lengthy they contain everything you legally need to know about how the credit card works, what is expected of you and what you will be charged for.”
A lot of times, credit card companies will offer special introductory interest rates in the very beginning. If you do not read the terms and conditions, you may be surprised to see that the rates could rise after a few months.
“The introductory rate may only apply to new purchases on the credit card. Some credit card providers require that you transfer over the balance of your existing credit card to qualify for the discount rate, however the transferred amount is charged at the standard interest rate from day one.”
Always be aware of your monthly payment schedule as well as your credit limit. Both of these things are very important factors when determining your credit score, which will in turn determine whether or not you are approved for a home or car loan, among many other things as well.
“If possible pay the balance in full, on time, each month to prevent interest charges (however please note the fees in 1.8 New Fees and Penalties). If you cannot pay the full amount, pay as much as you can. If you only repay the minimum amount requested, you may not be covering the new interest charges for the month. This will result in compounding monthly interest and ever-increasing credit card debt.”
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