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[C1013]Contract No Credit Card

by Admin, Adm

Trying to avoid these credit card secret traps is tricky because credit card companies constantly raise your credit limit, and offer you perks to get you to charge even more.

Credit card companies can get very creative with fees and interest rates and that's where you can get into financial trouble. To avoid this from happening here are some common credit card secret traps to be aware of when you compare credit card company terms.

Two Cycle Billing

The two cycle balance method is where the interest on your average daily balance is computed using both your purchases from that billing cycle and charges from the month before.

Even if you paid off your entire balance from the month before, that figure is still used along with your current month purchases to calculate your average daily balance. This credit card secret trap can keep you in deep debt for decades.

Credit Card Grace Period

A credit card grace period is the number of days before the credit card company starts charging you interest on new purchases. Most cards have a grace period but beware of the cards that don't.

If you have a card with no grace period, you always pay interest on new purchases from the day you make the purchase, even if you pay your bill in full.

Cash Advances

You almost never get a grace period for cash advances, which means you begin paying interest on that advance right away. Also, the interest rates on cash advances are typically higher than the ordinary rate on card purchases. A cash advance is costly and one of the most common credit card secret traps.

Credit Card Late Fees

Credit card companies can impose hefty penalties on any balance that you pay late or balances that exceed your limit. But the penalties of credit card late fees don't end there.

If you violate even one of your credit cards terms, other credit card companies may also punish you with penalty rates even if you have never missed payments on them.

Interest Rate Changes

Credit card companies are allowed to change your interest rate anytime, provided they give you 15 days notice. So read what your credit card company mails you because some companies will sneak this by hoping you won't catch it.

The bottom line is read the small print in the credit card terms provided by the card issuer regarding the credit card company rules concerning the billing method, grace period as well as the interest rates and fees.

Also, think about how you will use the card, especially if you expect to carry a balance. Then, compare credit card company terms and try to choose the card that keeps you from falling into these credit card secret traps.

This article is supplied by where you will find credit information, debt elimination programs and informative articles that give you the knowledge to correct your own credit and credit report. For more credit related articles like these go to:

If you are like most consumers, you probably haven't read the cardholder agreements for any of your credit cards. And who can blame you? The small print and the legalese those agreements are written in is barely legible. The truth is that credit card companies are hoping you won't read it. They would rather you didn't understand all the terms and conditions of their cards. But understanding the key terms of these agreements is extremely important because they explain how your balance is calculated and what triggers fees or interest rates.

You can save money by understanding the terms of your credit card. This knowledge will help you compare credit cards and know when you should switch to a new card to avoid increasing interest rates or other fees.

Here are a few key credit card terms you should be familiar with:

Preapproval- Most consumers have received offers in the mail stating that they have been "preapproved" for a credit card. This can be very misleading because in reality you haven't been preapproved for anything. In this situation, "preappoved" only means that you have met some initial criteria that indicates you are credit worthy. There is no guarantee that you will be approved for the credit card if you apply, although that seems to be implied.

Annual fee - Many credit cards charge the card holders an annual fee. This may range anywhere from $25 up to several hundred dollars for some premium cards.

Transaction fee- Most credit cards will charge a transaction fee for any transactions other than purchases. The transactions that are often subject to additional fees include cash advances and balance transfers. Some cards will occasionally waive these fees for new card holders as part of an introductory offer. The amount of the fee is usually calculated as a percentage of the transaction, and a minimum fee applies.

Grace period - You can avoid paying finance charges by taking advantage of a credit card's grace period, provided you pay your balance in full before the due date. In contrast, a card without a grace period will begin accruing interest from the day you use the card. However, if the card has a grace period of 20 days, for example, interest will not begin accruing for 20 days as long as the balance was paid in full the previous month.

Wise consumers take advantage of the grace period to avoid paying interest on their purchases while still enjoying the convenience of using a credit card rather than cash.

Article Source : How To Make Comp Cards

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Both Admin & Peter Kenny are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Admin has sinced written about articles on various topics from Infidelity, Tax and Class Action. Gary Gresham. Admin's top article generates over 368000 views. to your Favourites.

Peter Kenny has sinced written about articles on various topics from Credit Cards, Finances and Best Money Market. Peter Kenny is a writer for Finance 123. Please visit us at and. Peter Kenny's top article generates over 368000 views. to your Favourites.