Credit Card Transparency – Lesser Known Facts Associated with Credit Cards
Introduction
It’s wonderful to have a small plastic card that can be used as a system of payment. A credit card is so convenient to use that it is difficult to keep track of the number of swipes. If you have a credit card, you are one among millions. If you have an unexpected payment that was never anticipated or budgeted, a credit card can come to your rescue.
Considering the vast usage of credit cards, it’s important to get to know them well – what they are capable of, their pros and cons, etc.
Here are some well-known facts about credit cards –
- A credit card allows its users to buy goods and services based on the promise to pay for the purchased items at a later date.
- Credit card issuers usually waive interest charges if the balance is paid in full each month, but typically charge full interest on the entire outstanding balance from the date of each purchase if the total balance is not paid.
- Grace periods vary, but usually range from 20 to 50 days, depending on the type of credit card and the issuing bank.
The main benefit of having a credit card is convenience. A credit card grants short-term loans to its holder. This loan, along with interest, is repaid by the holder every month. Compared to debit cards and checks, credit cards offer more fraud protection schemes.
As a credit card holder, you tend to think you know what your plastic card is capable of. Think twice. Based on your usage, there are many more benefits or detriments that your card can offer. Some of them are as follows –
- Minimum Amount – Most card holders pay the minimum amount for years, but their original amount remains the same. The portion paid against the loan itself is much less than what is applied toward mark-ups and charges.
- Annual Percentage Rate – Interest rates tend to fluctuate. The APR can be lowered if you have a good credit score. If you have a good credit history with the bank, there are good chances that the APR will be lowered to a beneficial level.
- Billing Due Date – You might find it difficult to make a credit card payment if you have other payments due at the same time. If you have a good credit score, you can ask for the billing due date to be moved.
- Credit Limit – If you need room for large purchases, you can increase your credit limit by making a request to the credit card company. This could affect your credit score and there will also be a credit inquiry.
Conclusion
If you need to know more about credit cards and how you can have an effective debt management plan, debt management companies can come to your rescue. Pay plan debt management programs can give you a bigger picture and broader perspectives of your financial status.
To know more, please visit Debt Management Services
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