In my previous post I have discussed few parts of your monthly credit card statement and here in this article I am explaining the rest of them.
Grace Period:
It is a common question that how long do we have to pay our bill in full before we are charged interest?
The answer to this question is that if a balance is carried by you then you usually don’t have a grace period, and on new purchases interest accrues immediately. There is also a lack of grace periods for cash advances and balance transfers. For details you can check your credit card agreement.
Minimum Payment:
The lowest amount you can pay on your bill is referred to as minimum payments. Usually it 2% to 2.5% of the balance, though for some credit cards it could be as high as 3% to 4%.
Due/Pay-by Date:
Due/Pay-by date is that date on which your payment has to be recorded in the credit card company’s computer. You should remember that it’s not the date when your bill has to be postmarked, or it’s not even that date when the payment arrives at the company’s office. Typically, the bill cycle comprises of 29 to 31 days, and usually the payment is due 20 to 30 days from the date when the bill was printed.
You should find out your credit card requirements so that you know the rules of engagement. To make sure that your payment is paid on time, mail payments 10 days to two weeks before their due date. As to get the bill to you it already took the company a week, which means that when the bill hits your mailbox, you have to pay it quickly without any further delay.
Another option that you have for bill payment is that you should pay the bill online. By using this option you are able to make the payments immediately and avoid the postal system. Check with your bank in order to know that how long it takes for an electronic payment to be made and then you have to figure that into your payment schedule.
Credit Limit:
What’s the maximum that is allowed by your card to borrow?
If we talk about cash advances, the credit limit is a fraction of your overall borrowing cap which you have for the account.
Without notice your card company can change your credit limit, so each month you should verify the limit and also you should verify it before you make a large purchase.
Late Fee:
According to the April 2009 Bankrate survey,the average late fee that is being charged by the card companies on fixed-rate cards was $24 and $30 for variable-rate cards.
Over-the-Limit Fee:
If your card is charged by you beyond your limit, or if late fees has taken you over the limit, then each month you would be hit with this charge until that you bring your balance down under the credit limit.
In April 2009, it has been found by Bankrate that the average overlimit fee for fixed-rate cards hit $21and for variable-rate cards $29.
Name, Address, Account Number:
These are all self-explanatory. But you have to check them as well to make sure that all the information mentioned there is right. Addresses and ZIP codes change, and it’s quite easy to transpose account numbers.
Miscellaneous Fees:
Sometimes it happens that there are fees on the bill for those things that are not recognized by the consumers, like credit insurance.
Bottom Line
If you see an item that you are unable to recognize, whether it’s a charge or a fee, you should call the company immediately and ask for an explanation.
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