July 3, 2017 | Leave a comment Now that you’re almost set to order your first credit card, you need to invest some time in considering your plethora of options that you may be subject to as you will start approaching the credit card companies. Credit cards may apparently seem to be very attractive as it is something that helps you get something without having to pay for it immediately. But if credit cards are misused, nothing can be worse than the negative effect that they may have on your personal financial life. If you’re a holder of first-time credit cards, you need to read the fine print cautiously. But since you’re new, you may find some terms vague. Here is a list of the credit card terminologies that you must be aware of. Annual Percentage Rate (APR) The APR is the interest rate that is charged on your costs as an annual percentage. This means that if the credit card APR is 15%, you will divide it by 12 months and you get 1.25 %. This figure implies that if you’re unable to pay off your monthly debt obligation in full, an excess of 1.25% will be added onto your monthly balance. Annual fee If you’re a first-time credit cards holder, you must be aware of the term ‘annual fee’. This is the fee that you have to pay to the credit card company at the end of a year to keep your accounts active. While there are some credit card companies that do not charge annual fees from the borrowers, there are some secured credit card companies that charge annual fees. Secured credit cards are lent to people with bad credit score. Credit limit This term must be taken into account by a first-time credit card holder. The credit limit defines the maximum amount of charges that a card holder can charge on his card. The size of the credit limit and how you utilize your credit limit is something that can affect the credit score of a person. It is usually advised that one must keep his credit limit minimum to boost his score. Variable rate card You can come across credit cards that offer variable rates. With a variable or an adjustable rate card, you can be subject to changes in the current APR and this change will depend on the prime rate. The current credit card law does not impose any cap on the variable limits and therefore, your present APR may double or triple, depending on the card issuer. Due date Due date is the date during which you have to make your expected payment. If you fail to pay your amount within the due date, you will have to pay late fees or another kind of penalties. Such fees can unnecessarily increase your monthly payments and make it difficult to pay off your debt with ease. Keep a track of the due dates so that you do not fall back on your payments and need to run to debt consolidation nonprofit companies for help. Thus, if you’re a holder of first-time credit cards, you must get yourself educated on the various credit card terminologies so that you’re not taken undue advantage by your debtors. If you start transacting with your card without getting a grip on the terms involved, you might end up incurring credit card debt and run to debt consolidation nonprofit companies for help. Avoid such dire financial consequences by staying aware of the credit card jargons.