Credit Card Services

  Credit Card Services  - 3 must ask questions to maximize your 0% APR credit card return  - Apr 4, 2007  

As the competition between various credit card companies is increasing, they are adopting more attractive offers to acquire new customers. Though not new but 0% APR credit cards are also in the league of such offers. APR stands for Annual Percentage Rate - which in simple terms is the interest charge by companies on outstanding credit card balance. So a 0% APR means no interest is charged from the credit card holder.

0% APR credit cards come with many flavors:

0% APR for the life of credit card

0% APR for a limited period

0% APR offers for some services and a different APR rate for other services.

A credit card holder should face the fact that this kind of offer is only a marketing strategy and won't last for long. This is because that a credit card company is there to make money for their services and the APR is their leading money spinner. The 3 must ask questions listed below will surely help you get a perspective on your 0% APR credit card and make an informed decision.

1. How long will the 0% APR offer last?

If it is not for the entire life of credit card how long is the 0% APR offer going to last. Some credit card companies give this offer for 6 months, some 1 year and some for even more than that. If other things are the same the one with the longest 0% APR offer should interest you.

2. What APR will be charged after the introductory period expires?

What will the credit card companies charge you when the 0% APR offer expires should be your main concern. Because the credit card company has already losing revenue by giving you a 0% APR credit card offer it could try to compensate with a higher APR after the intro period expires. Compare this APR with the APR's of other credit cards which offer similar services. You shouldn't get ripped because you fell into a 0% APR credit card trap. This feels bad afterwards.

3. What are other fees and benefits of the credit card?

0% APR coupled with a high annual fees and other charges could wipe out the savings you intend by taking a 0% APR credit card. Also ensure the APR on cash advances, purchases, and balance transfer. If a 0% APR credit card offer tries to compensate for the loss in revenue by charging exorbitant APRs on other services its better to avoid it. Knowing about the different features and benefits is also helpful.

The idea is not to get ripped off by the credit card companies and get maximum benefits on the 0% APR credit card. The credit card companies sugar coat their offers to lure new customers but, it is in the interest of credit card holder to ask right questions and get complete facts before applying for any 0% APR credit card.

  Credit Card Services  - Keep a tab on credit card blocking to have room for financial emergencies  - May 22, 2007  

When a business such as hotel 'blocks' or keeps your credit card on hold for certain amount while you avail the services of the hotel or business is termed as credit card blocking. It must be sounding rather confusing, perhaps the example below will make things more clear.

When a person checks into a hotel and uses his/her credit card for registration, the booking clerk contacts the credit card company and depending on your estimated stay will tell the credit card company about your bill. Now, the credit card company confirms whether your credit card actually has the ability to pay the sum or not. If the answer is in affirmation the booking clerk will add other expenses such as travel, and utility to your bill and keep the entire amount in reserve.

Credit card block is pretty much useful for travel and business companies, because it helps them get paid for their services and check fraudulent credit card misuse. But, it hurts the credit card holder in more than one ways.

First, the amount blocked during any such activity is usually much more than the actuall bill. The hotels and travel agencies try to include every single expenditure in it to safeguard their interest. This thing can severly limit your ability to pay for other things with the credit card.

Secondly, if one of your credit card is blocked and incidentally you pay off the hotel or other bills with another credit card, the blocked credit card will remain in that state for anything between 10-15 days. The reason simply being that the credit card company doesn't know that the dues are cleared and the block should be removed. Again this will limit your spending ability.

These things can be avoided if a person takes proper measures. The first thing to do is to ask the booking agent about the amount of money blocked on the credit card, and how did they calculate that amount. Secondly, always pay your bills with the same credit card that was used for registration purposes. It will automatically save you from the hassles of getting the credit card unblocked. If for any reason, you have to pay with another credit card, ask the booking clerk to get the previous credit card unblocked, and verify that it was done properly.

Credit card blocking is somewhat good for the credit card holder in a sense that it doesn't allow him to cross spending limits with his credit card and cause unnecessary billing related problems for the hotel or travel company. However, credit card by their inherent nature are instruments to provide financial support during emergencies. By keeping a check on the credit card block, one can ensure that the unexpected financial demands are met easily with the credit card.

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