Terms to know about for understanding credit cards

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
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 » Research » Guides » Cardholder Benefits » Terms to know about for understanding credit cards

Terms to know about for understanding credit cards

The content is accurate at the time of publication and is subject to change.

Understanding credit cards will help customers see through the strategies used by credit card companies to get the better of them. Credit card companies are looking for profits all the time, which is why you must be sceptical about credit card rewards. Understanding credit cards means looking at the whole dynamics of how the cards work including the parameters and fine print that come with the credit cards.

Annual fee

A lot of reward cards with attractive offers eat into the customers` savings through an annual fee which could be as high as 100 dollars or even more. The annual fee is higher for the cards which are more in demand like the frequent flyer and frequent shopper reward cards. This is all the more reason to check the annual fee on the card and ensure that it has been waived at least for the first year.

Application Fees

With the new credit card reforms, credit card companies have lost a lot of revenue. Therefore, they are trying to make up for it through various types of fees. Application fee, activation fee, interchange fee for foreign exchange expenses and various other types of a fee levied by the card issuer shouldn`t be excessive. If they are, it is best to pass instead of making yourself vulnerable to the fees which could be hidden.

Penalties

Two types of fees that are levied as penalties are the late fee and the overdraft fees. When accepting a credit card offer, ensure that they are not way too high. Penalty could also include raising your APR excessively, although, thanks to the credit card reforms, these rates must be kept down if you make your payments consistently for 6 months. Nevertheless, you will have to keep an eye out for all these fees. The grace period available to you after the bill has been generated and the general flexibility you get will give you a good idea about how trustworthy a card issuer is.

Rewards

Credit card rewards are used by card issuers to entice the customer. However, understanding credit cards involves understanding the usefulness of these rewards. Rewards with a lot of caps, limitations and other conditions before you could avail them are practically not worth pursuing. On the other hand, low interest rate and cash back offers are something that is useful and hence better than discounts, bonus, loyalty, and reward points.

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.
Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Related Research:

Top 5 Cards for Travel from Our Partners: Winter 2019 – Expert’s Choice

Top 5 Cards for Travel from Our Partners: Winter 2019 – Expert’s Choice

Posted: December 17, 2018

Nights are still drawing out, the wind is cold, and the air smells like snow already – the winter is close. Christmas and holiday season are approaching swiftly, and overwhelming gift ideas are swirling chaotically in your mind. Ready or… Continue reading

Credit Card Tips For Holiday Shopping 2018

Credit Card Tips For Holiday Shopping 2018

Posted: December 15, 2018

November and December are the busiest months as gift shopping reaches its peak. People rush around looking for the best gifts and the best deals leaving a lot of money in the shops. Holiday season may force you to go over the household… Continue reading

Credit Cards to Save More on Holiday Shopping

Credit Cards to Save More on Holiday Shopping

Posted: November 25, 2018

Discounts and special offers are available all year round. Werther you are a bargain hunter or an impulse buyer, make sure you check online discounts and special offers. Also, if you are a cardholder, see if your credit card opens the door… Continue reading

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!