The Difference: Credit Card vs.
Charge Card
You may receive offers in the mail for new credit cards and charge cards, but do you
really know what the difference is? It is important to know what you are applying
for, as each product has drastically...
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The Difference: Credit Card vs.
Charge Card
You may receive offers in the mail for new credit cards and charge cards, but do you
really know what the difference is? It is important to know what you are applying
for, as each product has drastically different payment terms.
A credit card is typically
issued by a financial institution with a Visa, Master Card, Discover or American
Express branding.
They will set a limit on the card, and each month you will be given
the option of paying off the balance entirely, selecting your payment amount, or
paying the minimum payment amount.
If you rack up a high balance on the card and
only make the minimum payment you will be adding an interest charge to the
balance every month.
This just adds to your debt.
Some credit cards have decent
intro rates right now as low as 6%, but the subprime cards that target people with
bad credit can be as high as 29%! Also, if you are late on your payment just once the
interest rate can be bumped up to 29.
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