Applying for a Great Rate Student Credit Card? Watch out for those teaser rates!
By: Larry Goldberg
If you’re away from home for the first time, you may be tempted to apply for some of the hundreds of credit card applications you receive in the mail each month. From student cards with great rates to other tempting rewards style cards, it can be hard to ignore the offers. Moreover, once you hit college, you need your own card to download music, pay for gas to get home, and use in emergencies when Mom and Dad just aren’t around to bail you out. Before you grab the first application you see with a great APR, though, you should certainly factor in teaser rates.
What Are Teaser Rates?
Your APR, or Annual Percentage Rate, is the amount of interest you’ll be paying on your debt to the credit card company. While the APR may be applied differently to your account depending on your card company’s billing cycle, the lower the overall APR, the lower the amount of interest you’ll be paying on your student credit card purchases.
Teaser rates occur when a credit card company advertises a rate, but only under certain terms and conditions.
For example, you get a student credit card offer in the mail that offers you a 3% APR for the first year you have the credit card. Sounds like a good deal, right? Read the fine print carefully. If you make a late payment, your APR shoots to thirty percent. If you take out a cash advance, your three percent APR gets cancelled in a hurry. Want to make a balance transfer? Forget about that great APR rate.
How Do I Find A Card With a Great Long Term Rate?
This isn’t the easiest task in the world, but a great place to start is the fine print of the card. Remember that every single credit card company reserves the right to change any APR that you are quoted at any point in time, but most of them won’t unless the market seriously shifts or you violate the terms of the initial agreement.
As you try to sort through credit card offers, you might want to look around online. There are thousands of sites that will let you see and compare offers side by side. Even if you don’t choose to apply for your credit card offer online, you can still look at the details in an easier-to-use format.
If APR is important to you, look carefully at the terms and conditions regarding the APR. Understand how it applies to purchases, cash advances, and balance transfers. Know whether or not the stated APR has an expiration date, and when that grace period is over. Finally find out how the company might choose to cancel the APR.
Finding a great student credit card with a low APR isn’t an easy task, but with less research than your water aerobics class takes, you can have the perfect student credit card in your wallet in no time at all.
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