What are the basics of no annual fee cards I need to... - Other Questions


Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » Questions » User Questions » Other » What are the basics of no annual fee cards I need to be aware of?

What are the basics of no annual fee cards I need to be aware of?

Answered on

A credit card is a very convenient thing to have, since you do not have to carry cash with you everywhere. Second, if there is an impulse purchase or an urgent expenditure that you need to do now but don`t have the cash with you, then a credit card is an invaluable thing to have. But there are two negatives to a credit card. The first are the steep charges that are levied on you if you fail to make the payments as per schedule and your outstanding is overdue. The second is that many credit cards come with an annual charge which will be payable by you irrespective of the frequency of usage of your card.

No annual fee credit cards

But there are a number of credit cards available which charge no annual fee, and you need to keep this in mind while deciding which credit card to take. Like any regular credit card, you can use the card at all card accepting establishments, you can withdraw cash advances, and also enjoy the reward points and all other benefits when you use a no annual fee credit card. The only difference with a normal credit card is that there are no annual fees. These no annual fee credit cards are usually offered by credit card companies to attract people to start using their cards.

Who can get this card?

Usually credit card companies offer these cards to present holders of other credit cards in order to wean them away from those cards. But not all card holders get these offers. Only those people who have a very good credit rating are offered these cards. If you get an offer for such a no annual fee credit card, in spite of having a moderate to poor credit score, then you can rest assured that the card company will charge very high rates and other charges from you in lieu of wiping off the annual fees.

Things to be careful of

If a credit card company is offering you a no annual fee credit card then it is most likely that you have a credit card of another company on which your repayment record is very good. If you have been offered such a card in spite of a not so great credit score, then you are likely to be offered a product in which other charges, and rates of interest will be much higher than normal. In that case you need to weight the benefits of the no annual fee clause, against the demerits of higher charge structures. The second thing to be careful of is that a credit card without annual fees might just be a ploy to get you into the habit of using a credit card, but if you do not maintain a good repayment record then you stand to get a bad credit history which is more damaging than the slight inconvenience of paying an annual fee.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com, or wholesale clubs up to the quarterly maximum each time you activate.
Excellent, Good Credit
We'll match all the Miles you've earned at the end of your first year. For example, if you earn 30,000 Miles, you get 60,000 Miles.
Excellent, Good Credit
0% Intro APR on Balance Transfers and Purchases for 18 months. After that, the variable APR will be 15.49% - 25.49% based on your creditworthiness*
Excellent, Good Credit

Other Questions in

You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!