Deciphering Credit Card Terms Is A Task In Itself

Category: Finance, Credit.

Ever since Stacey Smith got her credit card, she has been trying to decode the alien credit card terms that the credit card companies use. The credit card companies use fancy language, which we don' t use in our everyday use.

Deciphering credit card terms is a task in itself! So much so that even filling the application form is a pain. We have complied a simple to understand credit card glossary. What is needed is a good credit card glossary to enable mortals like us to understand credit card terms. In simple words, it is card which can be used to obtain cash, goods or services up to a stipulated credit limit. Lets begin with the most basic" account number" .

The glossary covers some of the most commonly used credit card terms. It refers to a unique number that is assigned to every credit card. Some of the credit card holders are charged annually for holding the card. Next in the credit card terms come" annual fees" . This is known as annual fees. It is the rate at which card companies charge you every year for your account.

Another credit card term that would be used frequently is" APR" . No credit card terms dictionary is complete without the term" balance transfer" . It helps in saving your interest payments. It simply means moving your credit balance from one credit account to another. A credit card term that most people are afraid to come across in credit card terms is" bad credit" . It can be caused by late payments, exceeding card limits etc.

It means poor or bad credit rating. In credit card terms, the next word would be, "cash advance" . Then in credit card glossary comes" credit report" . Cash advance means a loan taken through your credit card, using an ATM. It is a record of your credit history that is usually consulted by lenders in order to decide whether they should lend you money or not, and how much. Debit card allows you to spend money on the balance available in your account- usually from a current or savings account.

In credit card terms, you will also find the term" debit card" . Next in our list of credit card terms is" grace period" . If you are going through a money crunch then this credit card term is essential for you to understand- the" minimum payment" . It is the time period between the transaction date and billing date when the payment can be made without incurring any interest rate. Minimum payment is the smallest payment that you can pay to keep your account in good standing. It is the security code that you need for authorization while making money transaction through your credit card.

Another very important credit card term to understand is" PIN number" . Next credit card term is" pre approved" . Here's to hoping that you would now feel more confident about using your credit cards with at least the credit card terms making some sense to you! This means a customer who has already passed the initial credit bureau evaluation.