The statement "look before you leap" is rightly said when one is tempted by the introductory offers of various credit card issuers. One may actually think that he or she can pay a credit card balance within the stipulated time before the rate of interest increases, but if everyone of us would repay the credits within the stipulated time, the credit card institutions wouldn't have made the profits that they are now banking on.
Certain credit card companies charge two rates of interest, one for balance transfer and the other for the purchases made. Hence it is better to make sure that the rate of interest offered by these companies applies only to the balance due. It is also better to know that rates can increase as sharply as 20% from a 12% interest in case of a slight delay in payment. That rate change is mostly permanent, and in case one falls trap to it, one may probably have to change cards all over again (but before that it is better to call the company to check if you stand a chance to come back to the lower interest rate).
In their quest for profit most card issuers are getting more particular regarding their fees starting from transfer fee to the over-limit-fees. Hence it is important to read the listing of fee charges while going through the credit card offer. In general the kinds of various kinds of fees include, Annual Fees, Late Fees, Closure Fees and fee for overseas transaction. Annual Fees could be avoided if you have a good rating and the balance is paid in full. There are plenty of card issuers who don't charge an Annual Fee. Some credit card issuers may charge a closure fee for an account closure. This is not acceptable to most consumers, so it is better to check out regarding this fee before buying a card. Late Fees is charged even if the payment is delayed for a single day and the rate of interest also increases accordingly. Earlier it was easy to use a Master Card or Visa abroad, as the fee charged was just 1% and it was better than the rates at exchange kiosks but now the card issuers charge about 2% in addition to the actual company's fee.
To put it in short, it is better to make sure how the rate of interest and fees is calculated for all credit cards that you hold and keep a tab on your bills.
David is the owner of
Loan Lenders, and
Finance Basics websites. David provides great resources for people seeking information regarding loans, mortgages and remortgages.
