0808 250 8276


Credit Cards that You Should Avoid

3 Flares Twitter 1 Facebook 1 Google+ 1 3 Flares ×

While there are many good credit cards out there, there are still those which lay traps for the unknowing customer, which is why it is important that you inquire about its terms and conditions before deciding on a particular credit card. These are the cards with the worst features to avoid. 

Credit cards with expensive initial fees. Watch out for credit cards that charge you even if you never make a purchase. There are cards which charge set-up fees, program fees, participation fees, fees for increases in credit limit, and fees for additional cards. These cards can rip you off just for having them so think very carefully before getting these types of cards.

Credit cards that have high APRs. The average rate of a bad credit card is 25% and the average rate on a low interest rate card is 11%. Any amount higher than 25% is considered unreasonably high and should be avoided. Make sure you read the credit card’s disclosure and compare the terms and conditions with various credit cards before choosing the one with the most favorable terms for you.

However, finding the one with a reasonable APR can be tough if you have bad credit. If that’s the case, consider getting a secured credit card instead.

Credit cards that don’t report to credit bureaus. One of the main goals of maintaining a credit card is for it to help build a better credit score. There’s absolutely no sense of keeping a credit card which won’t report your payment status to credit bureaus because it won’t help you build credit or repair damaged credit. Because your payment status won’t be reported, your positive payments won’t be able to help you out no matter how hard you try to pay your bills in full and on time.

Credit cards with high rates for balance transfers. Transferring balances between credit cards should be avoided in the first place because it teaches the cardholder that it is okay to pay off your debt with another debt. There could be some exceptions, however, if the new credit card has a lower APR and balance transfer fees. Make sure that you don’t bail yourself out from another card only to suffer from higher balance transfer fees and interest rates.

Cards with high credit limits and high interest rates for students. Credit cards can help young adults become financially responsible and build credit as early as possible. However, students are also one of the risky customers. It is important to help them build credit wisely and a high credit limit and high interest rate might not help make it any easier for them. A high credit limit can encourage them to take on more credit and high interest rates can make it hard for them to get rid of their balances.

Reward cards with high annual fees. If you make a lot of purchases and are aiming for a card with good rewards program, also take the time to look at the annual fees. Even if you earn as much as 1 point for every pound spent, it can easily be negated by an expensive annual fee.

Leave a Reply

© 2013 ExpressLogbookLoan.co.uk

3 Flares Twitter 1 Facebook 1 Google+ 1 3 Flares ×