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CREDIT CARD VOCABULARY MATCH UP
Match the terms with their definition
Advantages to using Credit Cards
AdvantagesConvenient payment
toolUseful for emergencies
Often required to hold a reservation
Able to purchase “big ticket” items and spread
out payments
Protection against fraud
Opportunity to establish a positive credit history
Online shopping is safer than using a debit card
because of the Fair Credit Billing Act protectionPossibility of receiving
bonuses, such as frequent flyer miles or cash rebates
Disadvantages to using Credit Cards
DisadvantagesInterest can be costly
when a balance is revolvedAdditional
penalty fees may apply
Tempting to overspend
Risk of identity theft
Responsible for lost/stolen cards
Applying for multiple accounts can lower your
credit score
Credit
When goods, services or money is received in exchange for a promise to pay a definite sum
of money at a future date
The price of money- when referring to credit, interest is the charge for
borrowing money
CREDIT-
INTEREST-
Lender and Borrower
LENDER-The person or
organization who has the resources
to provide the individual with a
loan
BORROWER-
The person or organization that is
receiving the money from the
lender
Debit Cards
• What is a debit card?– A plastic card which looks like a credit card, but is
electronically connected to the cardholder’s bank account
– Money is immediately withdrawn from the cardholders checking account
What is the difference between a credit card and a debit card?
Credit Card
What is a credit card?Pre-approved credit which can be used for the
purchase of goods and services now and payment of them later
A credit cards credit limit varies based upon an individual’s
perceived creditworthinessCredit limit is the maximum dollar amount
loaned
Creditworthiness is an individuals ability and willingness
to pay the money back
Credit Card Interest
Interest is charged each month the balance is not paid in full
The cost of credit expressed as a yearly interest rate
Rate at which interest is charged is referred to as:
Annual Percentage Rate (APR)
Minimum Payments• Required to make at least a minimum payment
each month– Usually only a small percentage (2.5-5%) of the total
balance due• Cardholders who only make the minimum
payment:– Make slow progress paying off card balance– Pay substantially more than what was initially
charged to the card
Minimum Payments
Amount charged to credit card in
one purchas
e
APRMinimu
m payment
Time to pay off
the credit card
Total amount paid in interest
Total amount
paid
$2,000 18% $50.00 62 months $1,077.25 $3,077.25
$500 12% $25.00 23 months $60.67 $560.67
Credit History – Positive and Negative Card Use
Credit ReportA record of a consumer’s credit history that
includes information about credit card use as well as the use of other types of credit, such as auto loans, student loans and mortgage loans
A number that summarizes an individual’s credit record and history. It is a numeric “grade” of a
consumer’s financial reliability
Credit Score
Credit cards can have a positive or negative impact on an individuals credit history
Positive Credit Card use
Proper credit card
use
Helps develop positive credit history
and credit report
Earn a high credit score
A high credit score gives the consumer the opportunity to have lower interest rates on loans, the privilege to use different forms of credit, and an easier approval process
for future credit
Positive Credit Card Use
• Examples of positive credit card behaviors:– Paying credit card balances in full every month– Paying credit card bills on time – Applying for only credit cards that are needed– Keeping track of all charges by keeping receipts
and using a check register– Checking the monthly credit card statement for
errors
Negative Credit Card Use
Consumers with low credit scores have difficulty getting loans, difficulty renting apartments, pay higher interest rates, pay higher insurance rates, and have
difficulty obtaining a job
Improper credit card
use
Develops negative
credit history
and credit report
Lower credit score
Negative CreditCard use
• Examples of negative credit card behaviors:– Making late credit card payments– Paying only the minimum payment– Exceeding the card’s credit limit (usually triggers a
penalty fee)– Charging items that can’t be paid off immediately– Owning too many credit cards
NO Credit
• If an individual has not used credit, they will not have any information in their credit report
• Not having a credit report can cause an individual to be denied credit
Credit Card Offers
Credit card issuers are required to disclose the terms and fees of credit cards in an easy to read
box format
This is called the Schumer box
Credit CardInterest Rates and Interest Charges
Annual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Annual Percentage Rate (APR)
for PurchasesThis section discloses the
interest paid for purchases on the
card. Multiple interest rates may be
listed here, because the final interest rate may
depend on the creditworthiness of the
applicant
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Introductory RateIf the credit card has
an introductory rate it will be shown in this section, which is the APR charged during
the credit card's introductory period after a credit card account is opened. The card will have a
different APR after the introductory period
endsWhat is the introductory
rate for this credit card offer?The introductory rate
depends on the
creditworthiness of the applicant, but it
will be 12.99%, 13.99%, or 14.99%
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Variable-rate APRSome cards will
have a variable-rate APR, which is an APR that may
change depending on other factors,
such as the prime rate. The prime rate is an index
that represents the interest rate most banks charge their most credit-worthy
customers What is the APR for
Purchases for this credit card offer?14.99%
Is this a variable-rate APR or a fixed-rate APR?
Variable-rate APR
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
APR for Balance Transfers
This section discloses the
interest paid for balance
transfers, which is the act of
transferring debt from one credit card account to
another. Balance transfer fees may apply, even if the balance transfer
APR is 0%
What is the APR for balance transfers for this
credit card offer?15.99%
Credit Card
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
APR for Cash AdvancesThis section discloses the
interest paid for cash advances, such as withdrawing cash from an ATM using a
credit card. Cash advance fees may
also applyWhat is the APR for cash advances for this credit
card offer?21.99%
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Penalty APR and When it Applies
This section discloses the penalty APR, as well as the penalty
terms that trigger the penalty APR to take
effect
•Penalty APR is the interest rate charged on new transactions if the penalty terms in the credit card contract are triggeredWhat is the Penalty APR
for this credit card offer?21.99%
Credit Card
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
How To Avoid Paying
Interest on PurchasesThis section
explains how you can avoid interest
charges on a credit card
How can a cardholder avoid paying interest on a
credit card?By paying credit card bills in full by the due
date
Credit Card
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Minimum Interest Charge
Credit card companies often have a minimum interest amount. These charges
typically range from $0.50 to $2 per month and are
disclosed in this section of the credit
card offerWhat is the minimum
interest charge for this credit card?$1.50
Credit Card
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
For Credit Card Tips from
the Federal Reserve Board
This section directs
consumers to the Federal
Reserve website to obtain more
information about credit
cards
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Set-up and Maintenance
FeesThis section
discloses any set-up and
maintenance fees for the card, which can include annual fees, account set-
up fees, participation fees, and additional card
fees
•Annual fee is a yearly fee that may be charged for having a credit card What is the annual fee
for this credit card?
$20
Credit Card
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Transcation Fees
This section discloses any
transaction fees for the card, which
can include balance transfer
fees, cash advance fees, and
foreign transaction fees
What is the fee for cash advances for this card?
$5 or 3% of the amount of each cash advance (whichever is
greater)
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Penalty FeesThis section discloses the penalty fees for the card, which can
include late-payment, over-the-limit, and returned payment
fees
•Late payment fee is charged when a cardholder does not make the minimum monthly payment by the due date•Over-the-limit fee is charged if the account balance goes over the set credit limit
Does this card have an over-the limit fee?
Yes, the over-the-limit fee is $29.
Credit Card Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
How we calculate your
balanceCredit card
companies can use one of
several methods to calculate the
outstanding balance on a
credit card. The method used is disclosed in this
section
What method is used to calculate the balance on
this card?Average daily balance
(including new purchases)
Interest Rates and Interest ChargesAnnual Percentage Rate (APR) for Purchases
12.99%, 13.99% or 14.99%, introductory APR for one year, based on your creditworthiness.After that, your APR will be 14.99%. This is a variable-rate APR that will vary with the market based on the Prime Rate.
APR for Balance Transfers
15.99% This APR will vary with the market based on the Prime Rate
APR for Cash Advances
21.99% This APR will vary with the market based on the Prime Rate
Penalty APR and When it Applies
28.99%This APR may be applied to your account if you:1. Make a late payment;2. Go over your credit limit;3. Make a payment that is returned; or4. Do any of the above on another account that you have with us.How long will the Penalty APR apply? If your APR’s are increased for any of these reasons, the Penalty APR will apply until you make six consecutive minimum payments when due.
How to Avoid Paying Interest on Purchases
Your due date is at least 25 days after the close of each billing cycle. We will not charge you any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
If you are charged interest, the charge will be no less than $1.50.
For Credit Card Tips from the Federal Reserve Board
To learn more about factors to consider when applying for or using a credit card, visit the website of the Federal Reserve Board at http://www.federalreserve.gov/creditcard
FeesSet-up and Maintenance Fees
NOTICE: Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available. For example, if you are assigned the minimum credit limit of $250, initial available credit will be only about $209. Annual Fee: $20 Account Set-up Fee: $20 (one-time fee) Participation Fee: $12 annually ($1 per month) Additional Card Fee: $5 annually (if applicable)
Transaction Fees Balance Transfer: Either $5 or 3% of the amount of each transfer, whichever is greater (maximum fee: $100)
Cash Advance: Either $5 or 3% of the amount of each cash advance, whichever is greater
Foreign Transaction: 2% of each transaction in U.S. dollars
Penalty Fees Late Payment: $29 if balance is less than or equal to $1000 OR $35 if balance is more than $1000
Over-the-limit: $29 Returned Payment: $35
* How We Will Calculate Your Balance: We use a method called “average daily balance (including new purchases).”* Loss of Introductory APR- We may end your introductory APR and apply the Penalty APR if you become more than 60 days late in paying your bill
Loss of Introductory
APRIf the card has an introductory rate, this area will list how the lower
introductory rate can be lost
How can the introductory APR be lost on this card?
If the cardholder is more than 60 days
late in paying the billWhat APR will the cardholder be charged if the introductory rate
is lost?The Penalty APR of 28.99%
Pre-Approved Credit Card Applications• Credit card companies send pre-approved
credit card applications in the mail– If an individual is pre-approved for that particular
card, they have passed the initial credit check• Compare credit card offers and determine
which card to apply for.
Credit Card Safety Tips
Sign card with a signature and “Please see ID”
Do not leave cards lying around, and report lost or stolen cards
promptly
Close unwanted accounts by writing and
phone, then cut up the card
Do not give out account
numbers unless making a purchase
Keep a list of all cards, account numbers, and
phone lists separate from
cards
Shred all pre-approved credit
card offers, applications, or
solicitations
Online Shopping Safety Tips
1. Use a temporary credit card number– This is a one-time use only number– A set amount will be charged to your credit card– Then a number will be given to you to do your
shopping
2. Use a credit card rather than a debit card– Fair Credit Billing Act protect consumers
while using a credit card to make purchases
Defining Credit Terms • Annual percentage rate (APR): The cost of a loan over a full
year expressed as a percentage.
• Bankruptcy: Legally getting out of having to repay debts; admitting and accepting financial failure. Destroys credit rating for seven -11 years;
• Capital: Assets in the form of cash and securities available to spend and invest
• Revolving Charge Account: Used to purchase goods or services in exchange for a promise to pay for the item(s) later.
CREDIT WORTHINESS3 C’s Of Credit to determine if you are fit to have a credit card
*Capacity: Ability to fulfill obligations evidenced by diligence at work and prospects of continuing employment or income. Can you repay the Loan?
*Character: The quality of one's reputation or name; financial or economic trustworthiness. Will you repay the loan?
*Collateral: Security on a loan (house, jewelry, car, etc.) What you have in case you do not pay the loan
• Cosigner: Second signer who guarantees to pay for the loan if the first party ( person who obtains the loan) defaults.
• Credit: A loan that allows immediate use of products or services in exchange for a promise to pay in the future.
• Credit Bureau: A private corporation that is a clearing house for consumer credit information. Collect information on credit practices of individuals.
• Credit rating (FICO): Creditor's evaluation of a debtor's willingness and ability to pay debts based on past performance. Ie: how promptly a person pays his/her debts. Ranges from 350 to 850.– Paying bills on time builds a good credit rating
• Default Failure to repay a loan
Finance Charge The total dollar amount that it costs a consumer to use credit.
TV Paid with Cash TV Paid with Credit Card• Regularly $400.00• On Sale $360.00• No Interest
• Total Cost $360
• 21% A.P.R.• 18 mo. pmts• $26.00 per mo.• $68.00 interest• Months financed X monthly
payment.
• Total Cost $468
• Garnishment Your employer pays your creditor before you receive your paycheck.
• Interest Price paid for the use of rented or borrowed money.
• Principal The original amount of a loan on which interest is based.
Groceries on CreditPrinciple = $125.00Interest = $14.00Final Cost = $139.00
Clothing on CreditPrinciple = $350.00Interest = $137.00Final Cost = $487.00
When you make the last payment, will the stereo, clothing, food you purchased be long gone?
3 Main types of credit:– Sales Credit• Credit you receive when you make a purchase and
promise to pay later.
– Cash Credit• Credit you receive when you borrow cash and promise
to pay it back later.– Service Credit• Credit given for immediate service one receives
(utilities, dentist, hospital, etc.) that will be payed for later.