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| Credit Cards: Information and Terminology You Should Know |
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| Glossary of Credit Card Terminology |
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| terminology used by credit card companies |
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| Make an Informed Decision - Credit Card Information and Terminology |
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| Annual
Fee |
| A yearly fee the
cardholder pays to have the credit card. Often billed
to your card monthly. |
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| Annual
Percentage Rate (APR) |
| The yearly percentage rate the credit card issuer
charges on the ongoing balance. This rate is applied
to your outstanding balance each month. |
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| Balance
Transfer |
| Transferring
the amount owed on one credit card to another credit
card. |
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| Balance
Transfer Fee |
| A fee charged
by a credit card issuer for balance transfers. It
can be either a small percentage of the amount being
transferred or a fixed dollar amount. Not all credit
cards charge this fee. |
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| Billing
Cycle |
| The time between billing statements,
usually 28-31 days. The start date of the billing
cycle does not have to be the first day of the month. |
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| Cash
Advance |
| A cash advance is a cash withdrawn
from an ATM or bank and charged to your credit card.
There are usually higher interest rates and other
fees associated with this type of transaction. |
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| Credit
Limit |
| The total amount of money that
may be charged on a credit card. |
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| Finance
Charge |
| Interest costs
and other fees associated with credit cards. |
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| Fixed
Rate (Fixed APR) |
| An annual percentage
rate that does not change. It will usually last
as long as the credit card is kept in good standings.
(payments made on time, not exceeding the limit,
etc.) |
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| Grace
Period |
| The time allowed to pay your credit
card bill without being billed a finance charge
and/or late fee. |
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| Introductory
Rate (Intro APR) |
| A lower interest rate lasting the
duration of the introductory period. |
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| Minimum
Payment |
| The minimum amount of money that
a cardholder is required to pay the credit card
issuer each month. This amount is usually a percentage
of the outstanding balance and will fluctuate as
your balance goes up and down. |
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| Over
the Limit Fee |
| A fee charged when the balance
exceeds the preset credit limit. |
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| Prime
Rate (Prime Interest Rate) |
| The best interest rate available.
Offered to individuals with excellant credit. |
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| Secured
Credit Cards |
| Credit cards that require a cash
deposit for approval. The credit limit will usually
be equal to the cash deposit, however, some credit
card issuers will set the limit in the amount of
the cash deposit plus a percentage (ie: one and
a half times your dposit - cash deposit = $500,
credit limit = $750). Secured credit cards are for
people with poor credit trying to reestablish. |
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| Unsecured
Credit Cards |
| Credit cards that are not secured
by cash deposits. Customers qualify based on credit
history, financial strength and current earnings. |
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| Variable
Rate |
| A variable rate is the prime rate
plus an additional rate. The prime rate varies throughout
the year, hence the name - variable rate. |
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| * These online applications are subject
to the terms and conditions as described in the Important
Information Section of the individual applications. |
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