Credit Card Terminology
If you’re new to the world of plastic, you might want to do some research first before agreeing on the first
credit card offer you receive. All credit card companies have a jargon that, fortunately, is universal. They use
certain terms on certain features that they attach to their credit cards. It might do you good to learn some basic
credit card terminology.
Annual Percentage Rate (APR) is the first credit card terminology that you should understand the most.
Technically, “APR is a measure of the cost of credit, expressed as a yearly interest rate”. The average APR in the
United States is around 18%. This is not something that credit card companies just decide to impose on a whim.
There are federal guidelines issued by the government that companies follow to decide on the APR they will impose
on a certain card.
Balance Transfer is another important credit card terminology for newbies. This feature allows the cardholder to
“use the available credit on one credit card and pay off another, ideally with a lower cost”. This is crucial in
maintaining or improving credit score since transferring balances or closing them out will reflect badly on your
Index, on the other hand, is the standard rate (e.g. prime rate), to which a company applies a margin amount to
calculate a variable interest rate. For consumers that pay off their balances at the end of each month, a variable
rate is easier to get.
Another important credit card terminology is interest. This is also called the finance charge and is the fee
that cardholders pay for borrowing money. You see the interest on your credit card statement as the Monthly Finance
A credit card terminology that is not to be mistaken for interest is the interest rate. This is the percentage,
usually per month, that a bank or credit card company charges a customer for borrowing money. For those who carry
out a balance each month, a card with lower interest rates is the most ideal.
What about fees? How will you know that the company is not ripping you off with non-existent fees that appear
differently on your monthly statement? The following are the basic fees that you should understand.
Annual Fee is credit card terminology that refers to the fee that companies charge to manage your credit card
account. Cash Advance Transaction Finance Charge, on the other hand, is the fee that you pay every time a new cash
advance transaction is posted to your account. Another credit card terminology is the Minimum Finance Charge, which
is usually around $0.50 and is only applied to statements that are subject to a finance charge. Another important
credit card terminology to fully understand is the Monthly Finance Charge. This is the fee that is issued for not
paying your credit card balance in full each month.
There are other fees that you need to learn before saying yes to a credit card company. Make sure you are
certain about all credit card terminology before getting your own credit card. Below, you will find
some articles on other credit card terminology that will assist you in being well-versed in the credit card
- Credit Card Compound Interest
Learn why you seem to never finish paying for your credit card bills. Let credit card compound interest teach you how card issuers make profits.
- Credit Card Late Charges
Learn to get rid of credit card late charges with these simple tricks.
- Credit Card Foreign Transaction Fee
Get a clear view of your credit card foreign transaction fee. Take a look behind the number that appears on your billing statement.
- Credit Card Protectionn Act
Want to know your rights as a credit card user? Learn about the recently signed Credit Card Protection Act of 2009 here.
- Credit Card Recovery
Start rebuilding your credit rating with these tips on credit card recovery.
- Credit Card Rejection
Learn common mistakes that lead to credit card rejection and how to avoid them.
- Credit Card Segmentation
Credit card segmentation divides customers into groupings based on their spending patterns.
- Credit Card Delinquency Rates
What are credit card delinquency rates and how do they affect the US economy? Find out here.
- Credit Card Amortization Schedule
Ever wondered how credit card companies calculate the amount you see in your bills every month? Learn all about amortization and credit card amortization schedule here.
- Credit Card Grace Period
What is a credit card grace period? How do you know if your card carries one? Read on to find out.
- Credit Card Payoff Calculator
Need help with managing your credit card debt? Learn about the credit card payoff calculator here.
- Credit Card Stamp Duty
What is a credit card stamp duty? How does it affect consumers like you?
- Credit Card Interest Formula
How do credit card companies compute credit card interest? Find out here which credit card interest formula is used by most card issuers.
- Credit Card Overpayment
There are actually more drawbacks to credit card overpayment than you think. Learn about them here.
- Credit Card Audit
Why do companies and individuals perform a credit card audit? How does it benefit them? Learn the answers here.
- Credit Card Freeze
Is a credit card freeze a good idea? When can this be done? Find the answers here.
- Credit Card Stop Payment
When is it possible to make a credit card stop payment? Find out specific situations here.
- Credit Card Management System
How do banks handle credit card services? Learn about the credit card management system here.
- Credit Card Check Tool
Want to learn how to validate a credit card number? Here’s the 411 on credit card check tool software programs.
- Third Party Credit Card
Want to boost sales? Start accepting credit cards now with third party credit card processors. Get to know them here.
- Credit Card Verification Engine
How do you protect yourself from fraudulent websites that are only trying to steal credit card information from you? Learn about the power of credit card verification engine tools here.
- Credit Card Balance Checker
How do you check your credit card balance when your statement hasn’t arrived yet? Your card issuer’s credit card balance checker should be able to help you.
- Credit Card Truncation
What is credit card truncation and how does it affect consumers and business owners? Find out here.
- No Minimum Income Credit Card
Where do you apply for a no minimum income credit card? Click here to find out.
- Credit Card Billing Cycle
How important is keeping an eye on your credit card billing cycle? What can you do to make it suited to your financial capabilities? Find out here.
- Credit Card Agreement
What is a credit card agreement? How valuable is it to a cardholder’s life? Let’s review the importance of a credit card agreement here.
- Credit Card Authorized User
What are the pros and cons of being a credit card authorized user? The article is an overview of what you must know before deciding to become an authorized user of a credit card.
- Credit Card CW Number
What is your credit card CW number? Where do you find it? How does it help protect you against fraud? Find out here.
- Credit Card Statute Of Limitations
What do you need to know about the credit card statute of limitations? How can it help you?
- Credit Card Verification Value
What is the credit card verification value code and how is it different from the credit card number? What use is it to cardholders and their safety? Find out here.