Credit Card Rules

While considering various credit cards to choose the right one for you, you should ask some key questions as follows.

An annual fee: If you are looking for a no-frill, low-rate credit card offer, there is no point to pay an annual fee. So you have to avoid cards, which charge annual fees. Many rewards cards, such as air-mile credit cards, high-end prestige cards etc charge annual fees in exchange for rewards or perks and services. But select one before a thorough research.

APR: The lower the interest rate, the less money you will pay off when you carry a balance. Do the cards come with a super low introductory rate or how long does the teaser-rate last or will you be able to pay off your card balance before the teaser rate expires- these are some questions, you should ask before selecting a credit card.

APR fixed or variable: Almost 70 percent of all credit cards offer variable rates. The interest rate on a variable-rate credit card fluctuates with the index. When the index shoots up, the card rate also increases while when the index slows down, the card rate also goes down. You have to make sure that the slide down occurs much slower than the rate increase. Some variable-rate card accounts are re-priced every month while others are re-priced every quarter. Unlike the variable-rate cards, fixed-rate interest card does not fluctuate each month or each quarter. But it is important to note that a fixed-rate card deal can change at any time.

Card’s grace period: Most cards offer grace periods to the customers, who pay off their balances in every month. A grace period is the period from the statement date to the due date. If the payment is made in full by the end of the grace period, no interest is charged. But if only a partial payment is made, interest rises in at the end of the grace period.