Credit card features differ from each lender so it’s a great idea to know which features you would want so you can tailor your search.
Below are some main features of credit cards that may differ between each credit card provider.
Balance transfers benefit those who have one or more credit cards and are struggling to pay them off. Balance transfer credit cards usually offer a much lower interest rate for a set period of time and are only available if you transfer the balance from your card/s. It can help you pay off your credit card balance sooner.
But take note, after the introductory period has expired the interest rate will revert to a rate which is usually much higher. Also be aware that the purchase interest rate will not necessarily be the same as the balance transfer rate and try to restrain yourself from making any purchases until you pay off your debt. This option may not be suitable for the undisciplined spender.
Minimum repayment amount
This is the minimum amount as a percentage of the balance or a fixed amount that you must pay each month. This amount is usually around 2 or 3 percent of the balance, which means if you were to only pay the minimum amount each month it could take years to pay off. Try to pay off the entire balance each month but if you are unable to, try to pay more than the minimum amount to ensure that you reduce the balance, pay less in interest and pay your credit card off sooner.
A cash advance is when you withdraw money using your credit card. The interest rate for cash advances is usually higher than the purchase rate and there are usually no interest-free days so you are charged interest from the moment you withdraw the money. Try and avoid making cash advances to save on interest charges.
The interest-free period is the amount of time when you are not charged interest on purchases. Each card offers different interest-free periods but the common period is 40-55 days. To avoid paying interest, take advantage of this time and pay for your purchases before the interest-free period ends. Make sure you leave enough time for funds to transfer.
Having the best credit card rate is immaterial if you’re paying a hefty annual fee. Some lenders may waive annual fees, however you’ll need to spend big on the card to earn this windfall. While many of us rely on our credit cards we should not forget that cards actually cost money to own and use. Many credit cards have annual fees around the $100 mark, but some have annual fees as high as $700 per year. There are no annual fees cards available but make sure you check the interest rates and other features to make sure it’s worthwhile.
Walk through the complete Home Loans Step by Step guides below;
Credit Cards Guide – Step 1 of 7 – Usage
Credit Cards Guide – Step 2 of 7 – Interest
Credit Cards Guide – Step 3 of 7 – Rewards
Credit Cards Guide – Step 4 of 7 – Features
Credit Cards Guide – Step 5 of 7 – Brands
Credit Cards Guide – Step 6 of 7 – Type
Credit Cards Guide – Step 7 of 7 – Checklist