Additional Cards
Cards issued on an account not in the primary or secondary name. Additional cardholders are authorized to charge to the card and make payments. They can also check the balance and available credit on the account. Additional cardholders are not authorized to make changes to the account.
Annual Fee
A fee charged once a year for maintaining an account and for any special services. Many Credit Cards have no annual fee.
Annual Percentage Rate (APR)
The periodic rate, expressed as an annual amount, used to compute the finance charge on an outstanding balance.
Authorization
The approval by the credit card issuer for a merchant or another affiliate to complete a credit card transaction.
Automatic Payment
A free service which automatically makes credit card payments by transferring funds from your checking or savings account to your Credit Card account.
Available Credit
The amount of unused credit available. Available credit is computed by subtracting the outstanding balance from your total credit line.
Average Daily Balance
The average balance for each day in the billing period, calculated by adding all daily balances together and dividing that total amount by the number of days in the billing period.
Balance
An outstanding amount of money. A checking or savings account balance refers to the amount of money in a particular account. A credit card balance refers to the amount owed. See also Outstanding Balance.
Billing Cycle
The number of days in the billing period. It includes the day after the previous close date through the current closing date of the account.
Cash Advance
Cash withdrawn from the available credit of your credit card account. There is no grace period for cash advances. Interest accrues daily and at a higher APR until the complete balance is paid in full. Transaction fees may apply.
Cash Advance Check
A cash advance check works like a personal check except the amount is charged to your credit card account. This check can be written to your choice of recipients and for any amount up to your available credit limit. These types of checks are posted as cash advances and will incur a transaction finance charge.
Cash Advance Transaction Finance Charge
A fee assessed on the date a new cash advance transaction is posted to an account.
Credit
Credit is a promise to repay a debt for purchases you make. It allows you to buy something today and pay for it later. Building a good credit history can help you buy a house or even get a job.
Credit Bureau
A credit-reporting agency that checks credit information and keeps files on people who apply for and use credit. The Credit Bureau produces a Credit Report, which is a record of a consumer’s level of indebtedness and bill paying behavior. The agencies compile the report and release it to lenders and others as permitted by law.
Credit Line
Also known as Credit Limit, this is the maximum amount you can carry as the balance on your credit card. If you exceed this amount, an Over-the-Credit-Limit-Fee may be imposed.
Credit Score
Also known as a credit rating. Many lenders use this numeric calculation of your credit report to obtain a fast, objective measure of your credit risk, and consider your score when deciding whether or not to approve a loan.
Finance Charge
Also known as interest, the finance charge is the fee for borrowing money. Finance charges may be imposed when you do not pay off your outstanding balance in full. See Monthly Finance Charge.
Float
When a cardholder makes a purchase or obtains an advance, the transactions may not post for a few days. The charge amount is not added to the balance of the account until the transaction does post. The time between purchase and posting is referred to as the float.
Grace Period
The period between the date of the credit card billing statement and the date payment in full must be received before interest begins to accrue on new purchases.
Interest
Also known as a finance charge, interest is the fee for borrowing money. Interest is listed on your credit card statement as the Monthly Finance Charge.
Interest Rate
The percent, per unit of time, that a bank or financial institution charges a customer for borrowing money. See Annual Percentage Rate.
Introductory Rates
Credit cards often offer lower introductory APRs as special promotional offers. After a period of time, the rate usually returns to the standard rate. It’s important to read the terms and conditions for all credit cards to fully understand how long the introductory rate will last and what the rate will be at the end of the introductory period.
Issuer
An issuer (or issuing member) is a financial institution which issues credit cards such as Visa® or MasterCard®.
Late Payment Fee
The charge that may be imposed if the Minimum Monthly Payment is not received by the Payment Due Date.
Linked Account
A Credit Card account may be linked to another credit card account so that funds may be transferred electronically between accounts.
Minimum Finance Charge
If your account is subject to a finance charge, a minimum finance charge may apply. Please refer to your credit card companies Customer Agreement and Disclosure Statement or Terms & Conditions for the minimum on your specific credit card account.
Monthly Finance Charge
If your credit card balance is not paid in full, you may be charged a Monthly Finance Charge. The charge is normally calculated on the statement closing date by multiplying the Average Daily Balance on the account by the Monthly Finance Charge rate (the Annual Percentage Rate divided by 12).
Minimum Monthly Payment
The minimum dollar amount that must be paid each month to prevent a credit card account from being delinquent. The amount is based on the percentage of your Outstanding Balance or a minimum fixed amount.
Outstanding Balance
The amount you owe on your credit card. This is the balance used to calculate payments and on which interest is charged.
Overdraft Protection
You can link your credit card to your checking account for optional Overdraft Protection. If you overdraw your checking account, money will be transferred from your credit card account to cover the overdraft or avoid a bounced check (up to the available credit on your credit card account). There is a cash advance transaction fee associated with the transfer.
Over-the-Credit-Limit-Fee
The fee that may be imposed if your outstanding balance exceeds your credit limit.
Payment Due Date
The date when your payment must reach your bank to avoid a late payment fee (if applicable).
PIN
Personal Identification Numbers (PINs) are secret numbers that customers use to access their accounts via ATMs.
Prime Rate
Most Credit Cards use the "prime rate" as a base rate (e.g., "prime + 12%"). The prime rate is merely a base rate used to make loans to certain borrowers. It is not necessarily the lowest or best rate at which loans are made. (The precise manner in which the rate is determined is normally in your credit card companies Customer Agreement and Disclosure Statement.)
Purchases
Credit card charges you make at merchants. Purchases usually have a lower APR than cash advances.
Secured Credit Card
A credit card that requires you to pledge collateral to receive credit.
Total Finance Charge
The sum of the Monthly Finance Charge and any Cash Advance Transaction Finance Charges (or the Minimum Finance Charge, if applicable).
Unsecured Credit Card
A credit card that is not secured with collateral. A customer can qualify for unsecured credit based on their credit history and financial strength.
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