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Compare
Credit Cards
Credit card issuers offer a wide variety of terms. When you
see credit card offers, consider and compare credit cards
terms, including the following, before you select a credit
card:
Annual
Percentage Rate (APR)
The cost of credit as a yearly interest rate. Low
interest credit cards are a good choice for those who
plan to maintain a balance on their account (not pay the full
amount each month).
Free
or Grace Period
Allows
you to avoid any finance (interest) charge by paying your
credit card balance in full before the due date. If there
is no free period, you will pay a finance charge from the
date of the transaction, even if you pay your entire balance
when you receive your credit card bill.
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| Fees
and Charges
Many credit
card issuers charge an annual fee for granting credit to you
($15 to $55 for most cards, and from $75 on up for premium
gold and platinum cards); many also charge a fee for a cash
advance or if you fail to make a payment on time or if you
go over your credit limit. Some charge a flat monthly fee
whether or not you use the credit card.
If you
pay credit card bills in full each month, the size of the
annual fee or other fees will be more important. If you carry
a balance, the APR and the method of computing your balance
are key terms to consider as you compare credit cards.
- Obtain
all credit card terms and fees in writing, including whether
a deposit is required.
- Apply
directly to credit card issuers. Do not give money to a
company that offers to get you a credit card for a fee -
you may not get a card or your money back.
- Beware
of "credit cards" that only allow you to buy from their
own catalogs.
- Beware
of companies that promise instant credit, or that guarantee
you a credit card "even if you have no credit history."
No one can guarantee you credit in advance.
When shopping
for a credit card, you probably will want to look at other
factors besides costs -- such as whether the credit limit
is high enough to meet your needs, how widely the card is
accepted, and what services and features are available under
the plan. You may be interested, for example, in "affinity
credit cards" -- all-purpose credit cards that are sponsored
by professional organizations, college alumni associations,
and some members of the travel industry. Frequently, an affinity
card issuer donates a portion of the annual fees or transaction
charges to the sponsoring organization, or allows you to qualify
for free travel or other bonuses.
To avoid
many common mistakes as you compare credit cards and credit
card offers, be sure to read: Precautions
for Choosing or Using a Credit Card.
 
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