Getting credit: The Fine Print
When applying for credit cards, it’s important to shop around. Fees, charges, interest rates and benefits can vary drastically among credit card issuers. And, in some cases, credit cards might seem like great deals until you read the fine print and disclosures. When you’re trying to find the credit card that’s right for you, look at the:
Annual percentage rate (APR)—The APR is a measure of the cost of credit, expressed as a yearly interest rate. Usually, the lower the APR, the better for you. Be sure to check the fine print to see if your offer has a time limit. Your APR could be much higher after the initial limited offer.
Grace period—This is the time between the date of the credit card purchase and the date the company starts charging you interest.
Annual fees—Many credit card issuers charge an annual fee for giving you credit, typically $15 to $55.
Transaction fees and other charges—Most creditors charge a fee if you don’t make a payment on time. Other common credit card fees include those for cash advances and going beyond the credit limit. Some credit cards charge a flat fee every month, whether you use your card or not.
Customer service—Customer service is something most people don’t consider, or appreciate until there’s a problem. Look for a 24-hour toll-free telephone number.
Other options—Creditors may offer other options for a price, including discounts, rebates, and special merchandise offers. If your card is lost or stolen, federal law protects you from owing more than $50 per card—but only if you report that it was lost or stolen within two days of discovering the loss or theft. Paying for additional protection may not be a good value.
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