Credit Basics 101
What You Need To Know About Credit

Credit Cards. Be Warned

Does the credit card work for you or do you work for your credit card? Most people's answer to that question will depend on how they treat their "old plastic" as credit cards are known.

For many with burned fingers will tell you they didn't realize that things had gotten so bad until very late, because most credit card offers try much to sound like they are actually running a charity. Well, they aren't.

And this is not a hate campaign against credit cards.

Surely they have their benefits - in America if you want to rent a car, you got to have a (major) credit card.

But, consider this scenario:

You receive an offer in your mail that sounds good, maybe it's a new generation TV or a fridge. But it costs $2000. Oh, but you have a credit card with a $5000 limit, and you immediately purchase your merchandise. Typically, here is how your repayment schedule will work out. Most credit cards charge a minimum of total balance (usually 2 percent) of the total per month. Assuming the interest rate is 18 percent and you choose to repay the minimum amount of $40, $30 of that will go towards interest and only 10 percent towards the principle. As a result, it will take 30 years to repay and you'll end up paying over $5000 interest.

Sounds scary? It doesn't have to be. The moral of the illustration is:

Use the credit card the same way porcupines make love: very, very carefully.



Translate Page Into German Translate Page Into French Translate Page Into Italian Translate Page Into Portuguese Translate Page Into Spanish

More Articles


Search This Site

Credit repair service


More Articles

How Does the Credit Card Work?

... If a caveman came back and made his way to a store offering Point of Sale (PoS) payment mode, he would be baffled by the ease at which Homo sapiens do their own version of hunting. In truth, the simple... ... 

Credit Repair the Do-It-Yourself Way

..Negative remarks on your credit report can cost serious money. You do not have to despair though, since it is never too late to become credit worthy again. However, always remember that credit repair... ... 

Credit Rating Agencies

... Nowadays a country's financial growth depends on how much its citizens invest and its annual expenses and profits.
Giving credit has always been in fashion, for it brings in good money to the potential... ... 

How to instantly delete inquiries, charge-offs, late payments
and judgments from your credit reports