How to choose Credit card?

APR

To evaluate credit card offers, you’ll need to learn the language they use. Here we offer you some of the most important terms.

  • Annual percentage rate (APR) – The cost of credit as indicated by an annual interest rate (fixed or variable). This rate and the periodic rate (APR expressed as a daily or monthly factor) must be disclosed to you before you incur a credit card obligation.
  • Balance Calculation Method – The formula used to determine the outstanding balance on which you will be charged interest for the billing period.
  • Finance Charges – The cost of the credit for the billing cycle, expressed in dollars and calculated by multiplying the outstanding balance by the periodic rate.
  • Fees – Fees (other than a finance charge) that may be imposed on your account. Common examples of this include annual fees, cash advance fees, balance transfer fees, late payment fees, and over-the-limit fees.
  • Grace Period – The time before your payment is due, during which you can pay off your debt without incurring any finance charges.

Once you can talk about the topic, ask questions.

Any credit card is going to cost you something, but depending on the terms and conditions, some are more expensive than others. When evaluating a credit card offer, you should consider some of the following points:

  • What is the interest rate? Is it a fixed or variable interest? If it is variable, how is it calculated?
  • Will different interest rates be charged for purchases, balance transfers, and cash advances?
  • What is the method used to determine the outstanding balance and what will be used to calculate the finance charge?
  • Is there an annual fee, and what other charges can I be assessed?
  • What is the length of the grace period (if any)?

Depending on the use that you are going to give the card, it will be what you should find out. If your intention is to pay off the balance in full each month and incur no finance charges, getting a low-interest rate is less important than finding a card that pays no annual fee, minimal transaction fees, and a long grace period. . If you carry a balance from month to month, you’ll want a low-interest rate and a method of calculating the balance that lowers your finance charges.

A few words about transfers

Maybe you’re not using your credit card right now but would like to minimize the finance charge on your balance. One way to do this is to periodically transfer your balance to a new card with an introductory “lure” rate. If you decide to “surf” this way, be careful. Be on the lookout for the following:

  • A low-interest rate on new purchases, but a higher rate on balance transfers.
  • An introductory interest rate that is in effect for a very short period.
  • Balance transfer fees, particularly unlimited amounts calculated based on a percentage of the transferred balance.
  • Termination fees and retroactive interest charges are imposed if you decide to “ride the wave” and close the account or transfer the balance to another card before the specified period has expired.

When you transfer a balance from an existing credit card to a new one, it’s a good idea to close the account you’re leaving. By doing so, you won’t be tempted to use that card again (at a higher interest rate, after the introductory rate period has expired), thus reducing potential fraudulent use or identity theft. What’s more, if you don’t close that account and later try to transfer your balance again, a new card issuer may deny your application for fear that you could incur too much debt by carrying a balance in inactive credit card accounts. credit, but they are open.

Express your concern if you are rejected.

If your credit card application is denied, the issuer is required to tell you the specific reason for the denial or tell you how to obtain that information. When the denial is based, even in part, on information contained in your credit report, you are entitled to a free copy of the report issued by the credit bureau. Get the report and review it; if you discover annotations on it, dispute them. Once this is done, contact the credit card issuer to make your case and notify the issuer of any corrections made to your credit report. With persistence, you could convince the issuer to approve your credit application.

Claim your rights

Your rights as a consumer regarding credit cards are protected by various federal laws.

  • The Fair Credit Reporting Act (FCRA) protects your right to know what information is in your credit file and establishes procedures to ensure that credit reporting agencies or credit bureaus provide information correct credit on you. 
  • The Fair and Accurate Credit Transactions Act of 2003 (FACTA) amends and strengthens the FCRA, provides protection against identity theft, improves dispute resolution of consumers, improves the accuracy of consumer files, and advances consumers’ use of and access to creditor information.
  • The Equal Credit Opportunity Act (ECOA) ensures that when you apply for credit there will be no discrimination against you based on gender, race, marital status, or age.
  • The Fair Credit Billing Act (FCBA) provides protection against billing errors (including limiting your liability for unauthorized purchases) and may help you reverse the purchase of inferior goods or services that have been charged to your credit card.
  • The Fair Debt Collection Practices Act (FDCPA) specifies what collection practices agents can and cannot use to collect a debt.

If you believe your rights have been violated and you are unable to resolve the situation with the creditor, you may file a claim with one of the federal agencies responsible for enforcing consumer credit laws, including the Federal Trade Commission. (FTC), or you can contact your state Attorney General’s office.

– See more at: http://www.360financialliteracy.org/Topics/Credit-and-Debt/Credit-Cards/Choosing-a-credit-card#sthash.5LrykKvA.dpuf

learn the lingo

To evaluate credit card offers, you’ll need to learn the language they use. Here we offer you some of the most important terms.

  • Annual percentage rate (APR) – The cost of credit as indicated by an annual interest rate (fixed or variable). This rate and the periodic rate (APR expressed as a daily or monthly factor) must be disclosed to you before you incur a credit card obligation.
  • Balance Calculation Method – The formula used to determine the outstanding balance on which you will be charged interest for the billing period.
  • Finance Charges – The cost of the credit for the billing cycle, expressed in dollars and calculated by multiplying the outstanding balance by the periodic rate.
  • Fees – Fees (other than a finance charge) that may be imposed on your account. Common examples of this include annual fees, cash advance fees, balance transfer fees, late payment fees, and over-the-limit fees.
  • Grace Period – The time before your payment is due, during which you can pay off your debt without incurring any finance charges.

Once you can talk about the topic, ask questions.

Any credit card is going to cost you something, but depending on the terms and conditions, some are more expensive than others. When evaluating a credit card offer, you should consider some of the following points:

  • What is the interest rate? Is it a fixed or variable interest? If it is variable, how is it calculated?
  • Will different interest rates be charged for purchases, balance transfers, and cash advances?
  • What is the method used to determine the outstanding balance and what will be used to calculate the finance charge?
  • Is there an annual fee, and what other charges can I be assessed?
  • What is the length of the grace period (if any)?

Depending on the use that you are going to give the card, it will be what you should find out. If your intention is to pay off the balance in full each month and incur no finance charges, getting a low-interest rate is less important than finding a card that pays no annual fee, minimal transaction fees, and a long grace period. . If you carry a balance from month to month, you’ll want a low-interest rate and a method of calculating the balance that lowers your finance charges.

A few words about transfers

Maybe you’re not using your credit card right now but would like to minimize the finance charge on your balance. One way to do this is to periodically transfer your balance to a new card with an introductory “lure” rate. If you decide to “surf” this way, be careful. Be on the lookout for the following:

  • A low-interest rate on new purchases, but a higher rate on balance transfers.
  • An introductory interest rate that is in effect for a very short period.
  • Balance transfer fees, particularly unlimited amounts calculated based on a percentage of the transferred balance.
  • Termination fees and retroactive interest charges are imposed if you decide to “ride the wave” and close the account or transfer the balance to another card before the specified period has expired.

When you transfer a balance from an existing credit card to a new one, it’s a good idea to close the account you’re leaving. By doing so, you won’t be tempted to use that card again (at a higher interest rate, after the introductory rate period has expired), thus reducing potential fraudulent use or identity theft. What’s more, if you don’t close that account and later try to transfer your balance again, a new card issuer may deny your application for fear that you could incur too much debt by carrying a balance in inactive credit card accounts. credit, but they are open.

Express your concern if you are rejected.

If your credit card application is denied, the issuer is required to tell you the specific reason for the denial or tell you how to obtain that information. When the denial is based, even in part, on information contained in your credit report, you are entitled to a free copy of the report issued by the credit bureau. Get the report and review it; if you discover annotations on it, dispute them. Once this is done, contact the credit card issuer to make your case and notify the issuer of any corrections made to your credit report. With persistence, you could convince the issuer to approve your credit application.

Claim your rights

Your rights as a consumer regarding credit cards are protected by various federal laws.

  • The Fair Credit Reporting Act (FCRA) protects your right to know what information is in your credit file and establishes procedures to ensure that credit reporting agencies or credit bureaus provide information correct credit on you. 
  • The Fair and Accurate Credit Transactions Act of 2003 (FACTA) amends and strengthens the FCRA, provides protection against identity theft, improves dispute resolution of consumers, improves the accuracy of consumer files, and advances consumers’ use of and access to creditor information.
  • The Equal Credit Opportunity Act (ECOA) ensures that when you apply for credit there will be no discrimination against you based on gender, race, marital status, or age.
  • The Fair Credit Billing Act (FCBA) provides protection against billing errors (including limiting your liability for unauthorized purchases) and may help you reverse the purchase of inferior goods or services that have been charged to your credit card.
  • The Fair Debt Collection Practices Act (FDCPA) specifies what collection practices agents can and cannot use to collect a debt.

If you believe your rights have been violated and you are unable to resolve the situation with the creditor, you may file a claim with one of the federal agencies responsible for enforcing consumer credit laws, including the Federal Trade Commission. (FTC), or you can contact your state Attorney General’s office.

By Master James

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