Credit Card Comparisons: How To

Not all credit cards are created equal. For those looking for credit card comparisons, it can be challenging. What’s best for one may not be best for another, so it’s extremely important that you weigh several different factors against each other before choosing including interest rate, fees, rewards programs and member benefits.

Here is a common break down of some of the most important factors one should look for and compare in a credit card offer.

1. Type of card

Credit cards have many variations, but they fall into three major classes.

• Secured cards require a security deposit and are for those who have no credit or bad credit.
• Regular cards do not require a security deposit but have few features. They have higher credit limits than secured cards but lower limits than premium cards.
• Premium cards (gold, platinum, titanium) offer higher credit limits and usually have extra features such as travel insurance or emergency service.

2. Grace period
The number of days you have to pay your bill in full without triggering a finance charge.

3. The finance charge
This is the exact amount you pay to use your credit. The amount you pay will depend on your current outstanding balance and the annual percentage rate of your card. Most companies use various methods to calculate your outstanding balance, and that method can really mean the difference in your bottom line. Did you know that yourr outstanding balance can be calculated over one or two billing cycles; including or excluding new purchases in the balance and by using the adjusted balance, average daily balance or previous balance. Know if the card has a minimum finance charge.

Credit Card Comparisons: How To

4. Fees included
Some cards have annual fees, late payment fees, over-the-limit fees, foreign transaction fees, balance transfer fees and more. Be sure you pay attention to the fine print!

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5. Cash Advance Features
The majority of cash advances carry a higher (much higher) interest rate than regular purchases. If you are going to use cash advances, look for information about access (ATM, “checks,” APR, fees, limits and how payments are credited).

6. Credit limit
Obviously, your personal credit limit will be determined by your credit history. Most card companies will look at your history but even if your credit is bad there are some cards that come with a predetermined credit limit.

7. Incentives and reward programs
Rewards cards can include cash rebates on purchases, online account access, frequent flyer miles, additional warranty coverage, car rental insurance, travel discounts, concierge services and more. If you have no credit or bad credit, you may have to work on building good credit before you are approved for a card with rewards and incentives.

8. Interest rate
Interest rates will be described in the credit card offer as fixed or variable, although in practice, there is not as much difference as the names imply. Variable rate cards will have their APRs pegged to an index — most commonly the prime rate — and will go up and down as short-term rates change in the larger economy. You may think you avoid the interest rate risk with a fixed rate card, but you won’t. Federal law allows card issuers to change any terms of the card, including its rate, with just 15 days’ notice.

CreditorLink offers credit card comparisons on over 100 credit cards. Our comparison system is 100% free to use and provides a quick and easy way to look at different credit card offers side-by-side to determine which one will be best for you. To begin comparing credit cards now click here.