5 Basic things to check before applying a credit card: Whether you’re applying for your very first credit card or looking to upgrade to a card that better meets your needs, it’s essential to research, research, research! There are so many good credit cards to apply for, you’re sure to find one, but there are a few factors to keep in mind before choosing a credit card. Let’s clear the clutter by understanding a few important things about the credit cards-
5 Basic things to check before applying a credit card:
1. Annual Percentage Rate (APR)
When you don’t pay your credit card dues in full each month by the due date, interest may accrue on the amount you owe. Your interest rate, which is shown as an annual percentage rate or “APR,” is the standard rate you’ll pay on the amount you owe. Lots of credit cards also offer you a lower introductory APR, where for a short-term period, you can pay down credit card debt with a lower interest rate (or, in few cases, 0% APR). You might also be able to take advantage of an initial APR by transferring a balance from a different credit card.
If you’re paying off credit card debts, this can be an excellent way to reduce the amount of interest you’ll pay overall. But make sure if you don’t pay at least the least amount due on a bill on time, your APR might relapse to the default rate. That would be the highest interest rate charged on that card. You should also try to pay off the balance transfer before the primary period expires to avoid paying higher interest rates.
If you pay your statement balance in full every month by the payment scheduled date, a grace period may apply. The time between when you make a purchase and when the interest begins accumulating is called the grace period. You don’t want a card that starts charging you interest the second you buy something! Save yourself a headache and pick a card with an extended grace period on purchases.
2. Credit Limit
Ordinarily, a low-limit card is a fantastic alternative for college students that are learning how to utilize credit for the very first time. As soon as you graduate, you might require a higher limit for more significant monthly expenditures. And using a more substantial limitation can help your credit with time because paying a lesser percentage of your credit limit monthly is very good for your credit rating.
But understand yourself if you have not been accountable for credit previously, don’t choose a high-limit credit card which will permit you to take on more debt than you can repay.
3. The Cost of Maintain the Card
Even when a credit card provides excellent advantages, you can spend a great deal on charges if you don’t read the fine print. The first fee to look for? A yearly fee.
Cards which charge a yearly fee may offer superior rewards in return, and a lot of these rewards (such as savings on travel) can offset the cost of this fee. If that is true for you, you might still save money by benefiting from cards which waive the charge for your first year. If you would like a no yearly fee card, you will find many to choose from.
Still another fee to look for is overseas transaction fees. Should you use your card abroad, the credit card company may charge around 3 percent of each dollar spent. There are several credit cards which don’t cost overseas transaction charges; you may easily prevent paying extra once you travel by choosing a card sensibly.
Among the best benefits of credit cards would be the wonderful rewards programs. To stand up the most things, decide on a card which provides you rewards for in which you invest the maximum, commonly gas stations, grocery stores, or specific stores or online retailers. Just make sure you spend on what you would typically buy because paying more merely to find a reward probably will not help save money in the long run.
5. Customer Service
Your credit card is something that you’ll reach for regularly, meaning you will probably have to call customer service a few times annually. Whether you’ve got a simple question or you noticed deceptive charges on your statement, you wish to consult with someone confident and capable that will quickly fix your issue. Fantastic customer service, particularly with something as critical as the own credit card, is something to search for. Jump any credit card firms using hard-to-navigate websites, or making it desperate to find a person on the phone as soon as your query is too complicated for the automatic telephone service.
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