Everything you need to know about credit cards are shared to you by the issuer once you have been approved and a credit card is issued to your doorstep. Or not. You need to learn more about your credit card, the fees and charges, interest rates, and penalties that apply. It is not enough that your credit card is all ready for use. Managing a tool that can bring your entire financial stability at stake is necessary. This is the most overlooked need that a credit card holder misses.
Here are a few things you need to know about your credit card and credit card issuer.
- Cash Advance Loans Have Higher Interest Rates than Charges
When you purchase something with your credit card and decide to rollover the credit, there are interest charges that apply to the outstanding balance. These interest rate charges are the payments being given to the issuer for the use of their money. One thing a cardholder needs to be aware of is cash advances. Cash advances apply higher interest rates and most of your monthly payments will apply to its interest. Priority of your payment will apply as follows: cash advance interest, cash advance principal, credit card charges’ interest, and finally credit card charges.
- Credit Card Companies Favor Rollover Credit
Try to pay your credit card in full every due date. Credit card companies often encourage that you rollover your credit as this allows them to charge fees and interest to your outstanding balance. Rolling over your credit is a way that credit card companies can earn. If you always have the habit of paying your credit card in full, it allows you to avoid paying extra for the interest and financial charges.
- Credit Limits Are Increased Without Your Knowledge
If you are rolling over your credit and closing your outstanding balance once in a while, this gives the credit card companies the sign that you are responsible enough with your debts. They will then start to increase your credit limit to allow you to make more charges on your card as they know you will find a way to pay for any outstanding balance.