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Credit Cards

A credit card is a form of borrowing that often involves charges. The credit card terms and conditions affect your overall cost, so it is important to compare the terms and fees before you agree to open a credit card account. You will want to consider the following terms when applying for a credit card:

Annual Percentage Rate - The APR is a measure of the cost of credit, expressed as a yearly rate. This must be disclosed to you before you become obligated on the account and on your account statements. Some credit card plans allow the issuer to change your APR when interest rates or other economic indicators change. Rate changes will raise or lower the finance charge on your account.
Free Period - Sometimes called a "grace period", this is a free period that lets you avoid finance charges by paying your balance in full before the due date. Knowing whether a card gives you a free period is especially important if you plan to pay your account in full each month. Without a free period, the card issuer may impose a finance charge from the date you use your card.
Annual Fees - Most issuers charge annual membership or participation fees. They usually range from $25 to $100, sometimes up to several hundred dollars for "gold" or "platinum" cards.
Transaction Fees and Other Charges - Some card issuers charge a fee if you use the card to get a cash advance, make a late payment, or exceed your credit limit. Some even charge a monthly fee whether you use the card or not.

Your Cardholder Protections

Federal Law protects your use of credit cards:
Prompt Credit for Payment - An issuer must credit your account the same day the payment is received. To avoid charges, following the issuer's mailing instructions. Payments sent to the wrong address could delay crediting your account.
Refunds of Credit Balances - When you make a return or pay more than the total balance, you can keep the credit on your account or write the issuer for a refund. A refund must be issued within seven business days of receiving your request.
Errors On Your Bill - Issuers must follow rules for promptly correcting billing errors. If you find a mistake on your bill, you can dispute the charge and withhold payment on that amount while the charge is being investigated.
If you decide to dispute a charge:
• Write to the creditor at the address indicated on your statement for "billing inquiries". Include your name, address, account number and a description of the error.
• Send your letter quickly. It must reach the creditor within 60 days after the first bill containing the error was mailed to you.
The creditor must acknowledge your complaint in writing within 30 days of receipt unless the problem has been resolved. At the very least, the dispute must be resolved within two billing cycles, but no longer than 90 days.

If You Lose Your Card - If you report a loss before the card is used, you cannot be held responsible for any unauthorized charges. If the card is used before you report it missing, the most you will owe for unauthorized charges is $50. To minimize your liability, report the loss as soon as possible.
Disputes about Merchandise or Services - You can dispute charges for unsatisfactory goods and services. To do so, you must:
- have made the purchase in your home state or within 100 miles of your current billing address.
- the charge must be for more than $50, and
- you must make a good faith effort to resolve the dispute with the seller.

Credit Card Tips
- Shop around for the plan that best fits your needs.
- Make sure you understand a plan's terms before you accept the card.
- Hold on to receipts to reconcile charges when your bill arrives.
- Protect your cards and account numbers to prevent unauthorized use.
- Keep a record - separate from your cards - of your account numbers, phone numbers, and expiration dates so you can report a loss quickly. (Photocopying the front and back of your cards and putting the copy in a safe place is a good idea).
- Carry only the cards you think you will use.

Education Center

Helpful Financial Forms - Download financial forms.

Credit Cards - Learn about important terms before applying for a credit card.

Consumer Rights - Learn about your rights under the Fair Credit Reporting Act.

Debt Warning Signs - Learn about the warning signs of debt.

Credit Scores - Learn about credit scores and why they are so important.

Telemarketing Scams - Top 10 telemarketing scams.

Money Saving Tips - Tips to help you save money.

Consumer Debt Statistics - Detailed consumer debt statistics in the U.S.

Debt Management Plan - How debt management helps you.

Credit Repair - How credit repair helps you.

Foreclosure Prevention - How and why to prevent foreclosure.

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