Are you on a lookout for a credit card? Before you finalise the credit card, just spare five to read this article and know what homework needs to be done. Here we will tell you the right way of choosing and using the credit card.

Every credit card company tries to lure customers by saying they have best offers. But if you dig deep in you will come to know that there is more to explore. While choosing a credit card, you must clarify the terms and conditions with the credit card company beforehand to avoid complications in the future.

APR (Annual Percentage Rate)

Annual Percentage Rate is an important factor both while choosing and using the credit card. APR tells you the payment you will be making on carrying over a balance, taking extra cash, etc. You must ask the issuer the periodic rate before taking the credit card. Also, if you are taking a variable rate card, then you must understand how the rate changes.

Annual fees & other fees

Carefully look at the annual fees before choosing a credit card. Though the annual fees vary, normally it is from $25 to $50, or may be $100 if you plan to choose a gold or platinum credit card. The credit companies can also ask you to pay fees if you happen to exceed your card limit, make late payments, or get a cash in advance. So, be careful while using your credit card.

Grace period

Grace period should be seen carefully while choosing a credit card. Grace period is the period that the credit card company provides you for paying the bills. If you receive the bill on the 15th of the month and you have to make payments by the 30th, then you have a grace period of 15 days. While using the credit card keep in mind that most credit cards companies do not give a grace period for cash advances and balance transfers, and charge interests instead.

Balance computation methods

If your credit card company does not provide you the grace period, then you must know the way your balance is calculated. Common methods of computing are Average Daily Balance, Adjusted Balance, Previous Balances and Two-cycle balances. You should be aware of these methods while using your credit card.

These are the few significant factors you have into consideration while choosing and suing a credit card. Other than this, make sure that you keep your credit card.

About the Author:

I write Articles on Loans for http://vipcredit.com

Source: www.isnare.com