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What You Should Know Before Getting A New Credit Card


Online banking is extremely popular, and now check card and credit card has become a daily use especially among young consumers. Credit card companies and banks are continually creating new products and sales pitches to get people to sign up for their latest offering. However, before you commit to a new credit card, it is crucial that you understand the rules and laws governing the use of check cards and credit cards while choosing the right one.


New Regulations for Your Credit Cards


The Credit Card Act and Truth in Lending are the two primary laws governing credit cards. The Truth in Lending Act mandates credit card companies to disclose the principal terms and conditions of their credit card in the application or during the solicitation.


The Credit CARD Act was recently passed, and there are more requirements on the credit card companies. Some of the conditions that Credit CARD Act provided include: a credit card company must send the card statement 21 days before the balance is due, 45-day notice for any significant changes to the terms of the card, and there must not be any retroactive changes to the rate of the existing balance.


Credit Card Fees


There are two important things to pay attention to when you’re reviewing a credit card terms – any fees the company associated with the credit card and the annual percentage rate (APR). The annual percentage rate is typically the cost of borrowing money on a yearly basis. So the lower your APR, the less money it will cost you to borrow money.


During the process of reviewing the APR, note if there is a teaser or introductory rate, whether it’s a variable or fixed rate. You should also check if there is a grace period between when the bill is due and your purchases and how the company will calculate the APR.


Another crucial factor to take note is the type of fees the company will subject you to by collecting the credit card. For instance, check the transaction fees, annual maintenance fees, credit card fees, and the late fees. Most of the credit card companies make their money through these fees; you could pay close attention to them. It is essential you read and understand exactly the type and number of charges they will be associating with your credit card.


Hire a Lawyer

Choosing a credit card does not need the help of a lawyer. However, if you have a problem with your card or with the bank that transmitted it to you, we recommend you seek legal help to discuss all your legal options.


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Revised: July 18, 2018, 11:44 a.m.
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