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What factors should I consider when applying for low APR cards?

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Applying for a credit card looks relatively simple when you go through umpteen offers. However, you might not have considered if the particular card you are applying for is right for you. A patient reading of the terms governing the credit card and comparison study can help in determining the right kind.

What type of a card you need? There are many kinds like regular credit card, student credit cards, universal credit cards and many more to choose from. You must understand your needs and then apply for the low APR credit card accordingly.

What are your plans on the usage of the credit card? If you opt to pay your balances in full every month, then the charge card will be the most suitable. You also need to have a very good credit history to be eligible for this option. If you intend to use the credit card for balance transfers then you should choose a credit card that offers the lowest interest terms.  The same is applicable if you wish to carry your credit card balances to the next month.

The next thing to look at is the APR or annual percentage rate. This rate on interest is levied when you are not able to pay your balances even after the grace period. If the APR is high you will be paying more on the revolving balance of your credit card account. Different APR charges are applied on purchase, cash advances and balance transfers by most credit card companies. So it is important to take note of this.

Another factor you should look at is the grace period a credit card offers. A grace period is the time limit within which you need to pay back the balance amount. This time duration is usually mentioned in days, from the date of billing for the purchase. Choose the credit card that has the highest number of days for repayment without interest, thereby saving you a lot of money in the process.

You should also know the type of fees applied by a credit card and the situation under which they are enforced. Over-the-limit fee, annual fee and late fee are the most common ones. Proper care should be taken to observe the calculation method of the finance charges a credit card company applies.

A low credit limit is advised for a beginner. This way one can learn the finer points of operating a credit card account. One should also stay clear of credit cards with no-limit or one will end up amassing mounds of credit card balance.

All credit cards terms, fees and rates mentioned in this article/post are actual on the posting date. See the current products’ Terms & Conditions on the issuing banks' websites.
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