Guard Yourself Against the Credit Card Trap Game

Even though a credit card may seem like a dream come true to some, it really is just a way for banks to make money off of their customers. Credit cards can give someone the money they need but don’t have, but there are always penalties associated with any type of loan. Credit cards include finance fees, late fees, over limit fees, and even cash advance fees, but many consumers do not notice them since they are more concerned about spending money that they do not have.

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Credit cards all have varying interest rates, and the applicant’s credit score usually determines the rate they will be paying. Individuals with lower credit scores will receive higher interest rates, while those with excellent credit can take advantage of credit cards with low rates. No matter how great someone’s credit is, there is always interest charged on a card and the cardholder will end up paying more than what they had originally borrowed. The only way to avoid this is to pay off the entire balance of the credit card before the interest is charged, otherwise plan on playing more back than you had originally borrowed.

Along with high interest 신용카드현금화 rates, credit cards also contain many different fees. The most common is a late fee, and this occurs when a monthly payment is not paid on time. These fees can range anywhere from 5 to 35 dollars, and the amount is decided by the bank. Even if the payment is only a day late, the fee is still charged and the cardholder is responsible for paying it. The only way to avoid a late fee is to make sure your card is paid on time each month, and it is best to pay it ahead of time to allow time for the payment to be processed and posted to the account.

An over limit fee is another common fee that most cardholders experience, and it is charged each time a credit card is charged in excess of the established spending limit. Even if it goes over only a few dollars, a fee up to 35 dollars can be charged. Interest rates and late fees can cause a credit card to go over the limit, meaning that you can actually be charged over 70 bucks just for paying your bill a day late. It is important to keep track of purchases you make on all of your credit cards in order to avoid over the limit fees, and also to make sure that no unauthorized purchases are being made on your account.

Because not all businesses accept credit cards, some banks now allow their cardholders to get a cash advance and have it charged directly to their card. They can get their cash from a number of different ATMs, but there are many different fees that are associated with getting cash out from a credit card. There is normally a fee charged by the ATM to dispense the cash, and then the bank sometimes also charges a fee for using a different bank’s ATM. Cash advance fees are also usually charged by the credit card company, and can range from five to twenty-five dollars.

Annual fees also are a very significant way for banks to make money off of their credit card holders, since they are required to pay an annual fee just for having the card. Annual fees can range anywhere from ten to over a hundred dollars, and must be paid each year that the card and account is active. If the annual fee is not paid off all at once, interest will be charged and require the cardholder to pay even more. The annual fee can also cause a credit card to be over its limit, which would create even more fees.

Even though credit cards make it possible for people to buy things that they may not be able to afford, they are full of expensive fees if your are not paying attention to your bill when it comes. Not paying credit cards or letting them go over the limit will have a negative effect on a credit score, which will make getting low interest loans in the future much harder to obtain. Even though it is nice to buy new clothes, shoes, or even electronics, using a credit card will make you pay much more in the long run. Before using or applying for any credit card, make sure to avoid the snare all the associated fee traps and determine if it is worth it to buy something now, or to wait until you have enough cash to do so.

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