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How Much Does A Credit Card Cost, Fees?
With many banks issuing cards, it is tempting for consumers to simply scratch their name on the signature line. While many experts believe maintaining credit cards with healthy transaction histories are essential for attaining healthy credit scores - the costs for the cards themselves do vary by bank and it is worth taking a look at, before starting anew.
Card interest rates/APR - very low intro rates, say 3% to 5% APR, or even, flooring at 0% may or may not be strict teaser rates. Typically, though, you can expect to pay higher rates for purchases if not just after the pass of some time, always for cash advances. On the flipside, some cards (such as store cards) do promote 0% purchases.
An intro rate may expire after a certain number of months from initiating the card - or hold through the life of the transferred balance(s) until payoff. Terms beyond the promo may vary, like prime plus 12% for example, or the rate could potentially go higher.
Making only minimum payments will accrue large sums of future interest. That will further increase actual rate payments being made.
Membership fees - annual fees range from roughly $20 to $500 but this may not be set in stone. Intended to simulate cardholder purchases (per cardholder agreement) such fees might be offset by a sum of buys based on the individual card at hand. - A low end fee, the Capitol One Platinum Card is $19 after the first year.
Secured Cards - in addition to maintaining deposits there can be other associated fees.
Inactivity charges - besides possibly impacting your credit report, there are inactivity fees that can be charged for a lack of transactions on the account [some of which was done away with by the Credit Card Act]. Inactivity fees rest in the vicinity of $19 to $50.
Late fees - Chase charges a $25 late fee, Fifth Third Bank charges up to $35. While others assess around $15 on up to $40. Also, late payments can affect your effective APR - where the bank could hike your account APR up to near 29.99% which is typically based on lateness/balance factors
If for some reason there is not enough mail time, an option at some major banks is to accept automated check processing up til the due date.
Overlimit fees - the fee for overlimit occurs when your total balance runs over the amount available (which can also be caused by finance charges on the account). Discover charges $39 on balances more than $1,000.
Balance transfer fees - when you transfer a current balance over to a new account, it is customary to incur a fee for executing this (promotions aside) in the neighborhood of 3% of the amount being deposited.
International transaction fees - whenever the card is used for making purchases abroad, this special charge comes into play from the bank which normally adds close to 3% of the amount charged - as always, depending on the bank or savings institution.
Cash advance transaction costs - amounts of transfer frequently have their own APR while being carried on the card account balance. But to initiate an advance, there are separate fees. Discover charges whichever is more: 5% of the transfer amount or $10.