Credit CardsAnish Desai

Principles of BusinessChapter 18

Finance Charge

A finance charge is the total dollar cost of credit including interest and all other charges

Credit Companies may use finance charge because they get additional money for using the convenience of a credit card

Interest Rate

Credit card companies usually charge 5-10% for interest

It is dangerous to pay the minimum amount of interest because they interest and money can build up

Credit Card Companies

Visa MasterCard American Express Chase

Credit Rating

It is important to know your credit score so you don’t go into bankruptcy, and so you can get a loan

Good credit score is 800 A bad credit score is 350

Benefits of Credit

With a credit card consolidation program you manage just one repayment at month, so instead of coping with several repayments at month you deal with a unique and lower item, then your debt management become easier

With the right credit card debt consolidation loan you get a lower interest rate, meaning that you are turning several high interest rate debts into a lower interest rate, if you do your research and comparison efficiently, you should be able to get the lowest interest rate in the debt consolidation loans market

Benefits of Credit

You become debt free in 3-4-5 years, with programs like debt settlement consolidation this span can be reduced to 12-36 months

If the consolidation of your credit cards involve a loan, then you are rebuilding your credit during the process, while with debt settlement you do not rebuild your credit, it has other benefits associated like paying less than what you owe today that should be analyzed

With credit cards debit consolidation or debt settlement consolidation you stop calls for collection from the companies. peace of mind is a high value asset, isn't it?

Problems with Credit

High Interest Rate Late fees/ Over limit Fees Bad Credit High Monthly Payments

Calculating Interest

PRT

Credit Application

A credit application is a written request for credit, generally in a form specified by the lender

You normally fill it out when you want to change your credit

Truth in Lending Law

Truth in lending law is the federal law that requires lenders to fully disclose, in writing, the terms and conditions of a mortgage, including the annual percentage rate

Fair Credit Billing Act

The Fair Credit Billing Act (FCBA) is a United States federal law enacted as an amendment to the Truth in Lending Act