Credit Cards
Credit cards are possibly the most popular form of payment for goods and services. They offer a convenient method of obtaining quick and simple to use credit. Credit cards are available from most major lenders and provide a high degree of flexibility for the consumer.
Many credit cards are international and can be used all over the world. They can provide you with instant access to money, (there may be a fee for obtaining cash). Goods can be purchased quickly and easily, in person, over the phone, or on-line! Some credit cards even offer insurance on your purchases and can protect your goods in the event of loss or theft. In some cases they can also provide you with travel insurance.
With all credit cards it is advisable to keep your receipts for purchases made as mistakes can sometimes happen. You should cross check your receipts with your monthly statement and any discrepancies should be reported immediately to the card issuer.
Credit cards issuers charge annual fees and interest charges. Interest rates tend to be higher than that of a loans or mortgages and vary between companies. Some companies offer interest free periods.
Most credit card companies insist on you repaying the minimum repayment.You can often expect penalty payments for late or returned payments or if you exceed your credit limit. The minimum repayment is usually calculated as a percentage of the outstanding balance and can be found on your monthly statement.
Applying is simple.
Application forms are usually completed and submitted to the credit card company and a decision on whether or not your application was successful is given within a couple of days.
Credit card companies use credit reference agencies in determining your application. If you are refused a card or wish to make enquiries concerning your own credit file, you can apply to a credit reference agency for your record.
Always memorise your Personal Identification Number (PIN). Note also, the card number, and issuer's details and keep them separate from your PIN. In the event of loss or theft contact the credit card issuer immediately to stop other people using your card. Some companies offer insurance against loss, theft or misuse of your card.
If you are unable to meet your monthly repayments and are struggling to repay your outstanding balance, you should immediately contact the credit card company. The earlier you approach them, the more sympathetic they will be to your situation.
Other forms of borrowing such as a personal loan or extension of your existing mortgage should be considered before applying for a credit card and can sometimes prove to be a cheaper option.