03 March 2009

Things to Watch Out While Taking a Credit Card

Do you have offered to make a credit card ...? For some people may have experience it. In this time Sales Marketing credit card is very incentive to making credit card offers. Which is often found in malls in Jakarta or other big cities. Maybe for some people there are who interested to make a credit card, but because of limited information about the credit card, they cancel the intention. Here are a few things to note when we want to make a credit card. Check it out....

When you are selecting a Credit Card you should be wary of lots of small riders like

Interest rate:

The interest rate might not seem to be very high to you because it is usually mentioned as 2.49% or 2.95%. But this is a monthly figure and hence the actual annual cost for you will be very high on conversion.If you convert the applicable monthly rate to an annual figure then a figure of 2.49% per month works out to 34.33% on an annual basis, 2.95% is 41.74%, and 3.14% is 44.91%.

Minimum Amount Due

The minimum amount due is usually a certain percentage of the total amount that you have to pay. This is around 5%-10%, and it can vary across cards. If you pay the minimum amount due then you automatically slip into the interest rate cycle, and the interest will start accumulating on the remaining outstanding amount that is yet to be paid. If you miss the payment altogether, not managing to pay even the minimum amount, then there will be a non-payment charge that will be levied along with the interest. This means there is a double hit on this account.

Annual Fees and Other Charges

There are annual fees to be paid on the credit card which represents an expense for you. These are generally waived on entry level cards but are levied on the premium cards. In addition, there are charges such as joining fees. The benefits offered by the premium cards are much higher than the entry-level cards. Hence, you should decide on the fees factor based on your requirements.

Credit Limit

The credit limit is decided after taking into consideration your income, your current job and position, your credit behaviour among several other factors that are decided by the bank issuing a credit card. A credit limit is not fixed forever once it is decided, but it keeps changing over a period of time. Depending upon the developments, including your track record, the credit limit can be raised and this will give you a higher limit to spend.

source: www.rupeetalk.com