The Federal Reserve Bank has recently issued guidance to credit card holders on how to improve their credit ratings. Among other things, this is a significant step in the direction of getting low interest credit cards (LICs), the short, introductory period of 5 to 15 days and fees up to $50 (or 3% of the annual fee). The new guidance is designed to help people with low interest credit cards to get the most out of as the market forces for credit card rates change (such as changes in market incentives, increased costs for cards and cards renewal or refund, greater costs for balance transfers, fees, interest and late fees, etc.).
For those who are only seeking lower interest credit cards, the major credit card issuers are going to be helpful and responsive, and the guidance is designed to help them make wise decisions with regards to making payments. Generally, low interest credit cards offer low interest rates or 0% APR introductory offers for a certain period of time as compared to the standard APR interest rates.
These credit card terms are generally not what you may expect to pay for if you incur a late payment, loss or other adverse event on your credit report. Paying in cash and using your credit card for spending purposes may result in higher interest rates than is the ordinary case. Your best bet with low interest credit cards is to learn how it works and then to make decisions about the kind of card to apply for.
How to pick the best low interest credit card
The best low interest credit cards should be chosen in a blender and microworm to help blender produce the results right out of the box. You may already be receiving inquiries on your credit reports concerning low interest rates and this guidance applies that knowledge to you.
Choose the terms which you will save Interest Charge on your cash advance. Some credit card companies advertise interest-free introductory periods and there is a possibility that the APR may increase by as much as 20%. Be sure the introductory period is available to all members but do not overlook other offers, such as rewards card membership and bonus miles. If you think that a certain APR promotion – such as 0% APR for a certain period of time will only apply to new card members for a certain period of time – take a look at the different card promotions and the introductory offers which may be offered.
Low interest rate credit cards is more suitable than other programs such as co-branded cards. Just beware that credit card companies may charge a high interest rate of as much as 25%, i.e. a credit card will charge you more if you do not use your credit card at all. Also read the fine print that clearly states the possible credit penalty if you do not use your card or don’t use it properly, such as late activation fees.
The following are some of the features of the Federal Reserve Board’s low interest credit card policy guide’
The low interest rate credit card (such as 0% APR on purchases, cash advances and some other types of cards):
You have the opportunity to apply for one low interest credit card for the first time. Every credit card company has their own credit ratings and will try to reach a merger with one or more companies, generally for a higher interest rate. However, because of the low interest credit card policy, no fees are charged.
Cash advances (such as car payments, mortgage payments, etc.) are not charged but can easily be cleared, whether or not you clear your credit card balance every month. Usually, you will have up to 15 days before you start to receive cash advances in advance. However, due to credit card privacy loopholes and strict liability provisions, no fees are payable in any other way than for the amounts received. A credit card will not be charged for clearing an unpaid balance of more than ‘1500.
Fees. Due to the small print in the Federal Reserve policy guide, you need to be aware about fees charged for using your credit card. Just for to say ‘Use it, pay it’, charged to you for a certain amount of time. Some credit card companies may offer you five or six months to pay the balance. This fee may rise after the introductory period is over. Your monthly limit may be reduced for this purpose if you use your credit card less frequently so it is up to you.
Late payment policies. In general, interest on purchases and other balance payments could be paid next day, not a few days after your invoice is mailed. This practice is convenient if you expect to pay ahead or to find you have paid the entire balance by the time your check arrives. Many low interest credit card companies waive the applicable interest charge for up to 24 hours. It is important for you to understand what charges may apply for before you make a decision and choose a credit card which offers you a low interest rate.