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MOST COMMON FREQUENTLY ASKED QUESTIONS
ABOUT CREDIT CARDS
This article consists of the most common
FAQ’s regarding credit cards.
1)
What exactly is a credit-card?
A small plastic card that consists of a
magnetic strip and is provided by any
financial institution or bank is called
a Credit Card. It allows the holders of
the credit card to but goods and
services on credit.
2)
What are the different types of Credit
Cards available in the Market?
There are several types of cards
available which fall under 2 major
categories: Charge Cards which allow you
to buy goods or services on credit but
expects you to make the full payment at
the end of every month and Credit Cards
which also allows you to make purchases
on credit but allows you to pay the
amount due over a period of time with
interest.
3)
Which type of credit card is the best?
There is no perfect answer to the
question as it depends totally on the
circumstances that you are in. It can be
decided only by you as to which type of
card will best suit your needs.
Generally speaking, majority of the
people prefer a credit card with low
APR.
4)
What exactly an APR is?
APR is the abbreviation for “Annual
Percentage Rate”. The companies that
issue credit cards make money in several
different methods. One of primary ways
is the APR which is interest charged on
your outstanding balance each year. For
example, if your rate is twelve percent,
then you should pay that much interest
every year for your outstanding balance.
5)
How to get a low APR?
The APR offered to you is entirely
dependent on the credit score of yours.
It is as simple as this: for a high
credit score you get a lower APR and
vice versa. Therefore, to lower your APR
you should increase your credit score.
6)
What is a “Secure Credit Card”?
If you did not get approved for the
regular card due to low credit then your
option is to get a “Secure Credit Card”.
In this case you have to deposit an
amount to the bank and you get a credit
card with a limit equivalent to that
deposited amount. The money will stay
with the bank as a security for your
credit card payments. If you pay your
payments religiously then the bank many
give you an approval for the regular
card.
7)
How to compare the credit cards?
Some of the comparison factors for the
credit card are late fees, penalties,
finance charges, annual fees and
interest rates. There are comparison
websites found on the net which you can
use to find the best card for you.
8)
How to apply for a regular credit card?
Applying for a debit or credit card is a
very simple process of filling out a
form and submitting it to the bank.
However, applying for the right credit
card will take some pain and effort. You
can also apply online.
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