Credit Cards

Credit-Card 3

The card issuer in most cases it is a bank, opens an account along with the revolving line of credit, where the card holder can borrow money with for paying of prepaid expenses or to the merchant.

A credit card has any differences depending on requirements on returning: in one case, a balance should be refilled every month in full; another product allows having of the debt current balance to card holders, considering the interest accrued. Also, credit cards fall into 2 categories the local products and having a currency account for trips abroad of the cardholder. The main feature of credit card usually it is presence a third party paying to the seller that will be compensated by cardholders so the credit card gives to buyer a possibility to hold over the payment of goods at a later term. Since 2009 was ordained a law of credit card according to it, were entered over-limit fees. Some card issuers organized warning system of customers about the commission that allows customers refusing the possibility of a future transaction. Other issuers simply closed the possibility to customer using over-limit loan. In practice bank issuer makes a decision allow transaction over-limit loan or not, also the customer decides should he fall outside the limit card or might buy something later. No doubt any costs beyond adopted limit transactions will result into overpaying for customers choosing this type of card to charge. This law became on 22 February 2010 according with which financial organizations must show to customer the information about approximate payment schedule on credit card.

A good credit card can be a real helper for those who can keep cool head and plan your budget. Independently of the “size” of your dream — an ice cream or a tour to Maldives – bank borrows you the needed sum via a credit card. You even have a “vacation time” for about 30 days when you can return the borrowed amount without any extra fees. And conversely – if you skip a chance to pay back during this percentage-free time, you’ll get an unpleasant interest in addition to the main debt.

Credit card – advantages and disadvantages

Advantages

  • You can buy a significant thing and return the money by small parts.
  • You can create your personal credit history and if you manage to keep it reliable – it can be of great help sometimes.
  • You can feel secure without keeping cash in your pocket.

Disadvantages

  • If you’re a shopaholic or cannot keep your emotions under control – you are endangered to sink in debts.
  • Simple principle of use can lead you to global overspending.
  • Meaningful interest rate can be transformed into an additional duty to you.

Credit card – choose correctly

Before requesting for a credit card, try to answer a question – do you really need to spend money that you’re obliged to return with interest? Think reasonable — are your wishes so vitally important or they can be postponed to better days?

If you never break the period you have to pay back, a credit card with «gains» can be a good choice for you. As a bonus you can get airline miles, discounts or other privileges but at the same time such cards have higher interest rate.

In case you intend to lower extra payment (interest), you’d better choosing a card issued by a big assured bank that determines all the conditions that will satisfy you. Such cards usually work through net (like VISA) and it will not give you any troubles. Choose the most suitable credit card for your needs and use it rationally for the benefit of your family.