How to get the right credit card?

Knowing how good your credit is is the first step you should take when picking out a credit card, then to realize the uses of a new card. Fundamentally, these include transferring the balance from another credit card or cards and to make no new purchases; accumulating new consumer debt; or making purchases transactions only to pay off in full monthly. If you want to have debt on your new credit cards because you will not pay your balance in full every month, then the next decision you have to make is whether you want to use your new credit ...

Credit Card Fees

Rates change over time, sometimes from an Introductory APR to a regular APR or a default APR. Introductory APR rates, sometimes as low as 0%, are used by issuers throughout an introductory period to attract new customers and most often does not apply to cash advances. When the introductory APR period ends, the APR increases to its regular rate**. Both the introductory and regular APR can be switched to default APR if you do not pay your monthly bill on time, typically over 20%.** The default APR is your penalty when you fail to make the minimum monthly payments for ...

Reward Cards

With so many rewards programs available to today's cardholder, everyone can find the card right form them and their hobbies or interests. The most common categories of rewards types include frequent flyer programs from a particular airline, such as the Jetblue American Express; Cash back rewards awarded based on the percentage of your purchases; Hotel points **rewarded based on nights spent at the affiliated hotel chain; and, finally,** Generic points rewarded through your credit card company.

Rate changes over time (Intro, Regular)

Introductory rates, used to lure new customers, can change to a regular APR or Default APR. Introductory APRs may end early if you pay your bill late or go over the limit but is meant to last through the Introductory APR period, at which time it increases to the regular rate. The Regular APR is the APR you are assessed for purchases, transfers, or cash advances and, if your bill is not paid on time, can switch to a Default APR*. ***The default APR is your penalty when you fail to make the minimum monthly payments for your card, or ...

Types of Rates (Purchase, Transfer, etc.)

A credit card Rate, APR, Interest Rate and Annual Percentage Rate are all the same exact thing. A cardholder's Annual Percentage Rate is the yearly interest rate they can expect to be charged on the total balance and do not include penalty fees and membership fees. The different types of APRs include the Purchase APR for purchases made on your credit card; The Transfer APR for balances transferred from another credit card; the Cash APR for cash advances; and the Default APR** for all aforementioned rates to increase in the event of going over the limit or paying late. ...

Variable vs. Fixed Rates

Credit cards are offered with either a fixed rate/APR or a variable rate/APR. They're both influenced by the Prime Rate to one extent or another. The prime rate is the interest rate banks charge their most creditworthy customers and fluctuates with the Federal Funds Rate, which no single bank controls. A fixed rate APR locks in and does not fluctuate with the prime rate and only changes when informed by your credit card company for late payment or going over the limit. Most cards, however, have a Variable Rate that changes over time with the Prime Rate, but your rate ...

How Balance Transfers Work?

Transferring a balance from one card to another is most useful on saving on interest charges, wherein the first card (ie Capital One Mastercard) makes a payment to the second(ie Bank of America Visa). The Capital One Mastercard will not charge a fee whereas the Bank of America Visa will most likely charge a transfer fee of around 3% of the transfer. In this instance, the Capital One Mastercard, nor can any other card, prevent any cardholder from transferring the balance.

How Does a Credit Card Transaction work?

When you swipe your Visa at a merchant card terminal, the terminal transmits an authorization request message through the Visa network, to which a response message from the network indicates an approved or declined authorization. As an authorized transaction, not only do you get to leave the store with your purchase, it is then held in a batch through the appropriate network and sent to the merchant's bank at the close of business. The money is then debited from the issuing bank and given to the merchant, minus bank, issuer and network fees. You must then payback the amount either ...

What are Credit Card Networks?

In making a distinction between credit card companies and networks, remember Visa, Mastercard, Discover and American Express are the four major credit card networks. American Express and Discover, however, are also credit card companies, which you would directly contact with a customer service issue. Visa or Mastercard customers, however, would contact the issuing credit card company. While all the networks process credit card transactions, they also set transaction terms and act as a gateway for merchant transactions.

How does a Co-branded Credit Cards work?

When a large corporation and a credit card company sign partnership agreements, they create a co branded credit card. A Visa offered by United Airlines, for example, is a partnership offer from United Airlines and Chase, for which United Airlines handles the marketing. With specifically tailored rewards for items offered by the large company, such as mileage rewards, co-branding helps the corporate partner generate profit from the credit card companies. Co branding also establishes consumer loyalty for the corporation and its brand.

Cards 101

How to get the right credit card?

Credit Card Fees

Reward Cards

With so many rewards programs available to today’s cardholder, everyone can find the card right form them and their hobbies or interests. The most common categories of rewards types include frequent flyer programs from a...

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