Using your credit card enough? Is it those who make smaller purchases or monthly and recurring ones? No matter what the frequency of use, but do you know how your credit card interest rate works? Is he an ally or arch enemy of your budget? Do you already know how it works? And the interest rate? Legendary explains to you in this post.
How does credit card work?
Upon requesting the card and reviewing your financial profile, a monthly credit limit will be made available. After the 30-day period, you will receive your credit card statement and you can choose between full or partial payment. If you pay in part, be aware that this practice is dangerous if you have no financial discipline, as the debt may get bigger than you can reconcile. This is the famous revolving credit .
To hire him you must pay any amount between the minimum and the total of your invoice. The missing amount will be automatically funded and posted the following month with interest. This mea
ns that if you paid the minimum invoice this month, you will not be able to resort to the minimum the following month.
What am i paying for?
Still don’t know NiceOne Bank Resolution CMN 3.919 / 2010? Through it, it was possible to establish 5 basic credit card rates – the card that has no reward and / or loyalty program:
- Annuity : charged once a year, the financial companies may installments the amount over the 12 months;
- Emergency credit : When does the card limit break? Yes, there is a charge for this type of operation;
- Monthly invoice : After 30 days of use you will receive at home, or digitally, the monthly card bill for the minimum or full payment;
- Card withdrawal: Does the credit card withdrawal have no fee? Yes there is! And it is one of the highest!
- Duplicate: it was stolen, stolen or simply lost? You may pay an amount to get the duplicate.
And how is the interest on the invoice?
Let’s say your revolving credit monthly interest rate is 12% and your credit limit is $ 800.00. In a given month you use the total limit of $ 800, however, you can only pay $ 400. When the total limit is not reinstated, there is still a charge of 2% late payment and 1% late payment interest.
Therefore, on the next invoice, you will not only pay the remaining $ 400.00. But yes $ 230.00. Why?
- Remaining invoice : $ 400,00;
- Revolving credit interest : $ 96.00 (12%);
- Interest due on delay : $ 16.00 (2%);
- Default interest : $ 8.00 (1%);
- Next month’s invoice : $ 520,00.
How to know the interest rate of my card?
To know the interest rate of your institution’s credit card there are two possible ways. One is to check directly with the card company, which is often your own bank. But if you have a Nubank card, for example, revolving interest rate information is found under the “My Account” option.
The other possibility, especially if you are still looking for the best card to hire, is to check the rates of credit transactions reported on the NiceOne Bank website.
When is it worth splitting?
When we make an installment payment using a credit card, it is as if we made a loan. If the installment is interest-free, it may be a good option for anticipating a dream or need, but when it comes to an interest credit, you need to be aware.
If you would like to install an interest card purchase, you should look at the Total Effective Cost of the transaction. This means that in addition to considering interest you must consider the other fees involved in the transaction.
Remember that some establishments may offer discounts on spot purchases. Therefore, you need to compare the various forms of credit and see if this discount is higher than the interest you would pay on a loan, for example.
Those who do not want to pay high credit card interest may opt for other loan lines with much lower rates. The personal loan remains one of the best options for those who cannot pay the full bill and do not want to default or bear high interest rates.