There is a wide plethora of aspects to look for when interested in a credit card. Just like you have probably guessed already, your personal necessities can dictate this choice. Unfortunately, most newbies are not advanced enough to do it by the book. They are often lured in with all kinds of credit card offers, even if they do not perfectly match their needs. With these ideas in mind, you have to sit down, check all the credit cards around you, compare credit cards and make a decision based on your research. In the attempt to save some money, plenty of people try to find credit cards with no annual fee. Is this the best option? To many of them, it is. But even so, there are more alternatives out there, so do your homework.
Interest rates – your first considerations
The interest rate (APR) is the most important thing in credit cards with no annual fee. Not paying a maintenance fee is definitely an advantage, so the company uses it to compensate for a weakness. It is your responsibility to identify this minus, but also to determine if it can affect you. No annual fees are often marketed in credit card offers as well. Most commonly, the problem is in the interest rate. The same rule applies to credit cards for no credit. Banks lure you in, then they base their profit of your incapability to repay the money.
Interest rates can be fixed on variable. Most commonly, they are fixed. Even if you do not repay within the first month, at least you know what the interest rate will be. Forget about unpleasant and unexpected situations. With all these, you can still face different charges due to paying late or going over the limit. Keep in mind that issuers can change terms, including the interest rates. They only need to notify you about it. Therefore, credit cards for no credit can turn pretty harsh if you are not careful enough when choosing the right one.
Paying attention to the credit limit
The credit limit represents the money you can borrow according to the issuer’s permission. Normally, it depends on the credit history. Therefore, credit cards for no credit will not provide such a high limit. On the other hand, credit cards with no annual fee have no limitations. You can get a few hundreds, as well as tens of thousands. Ideally, you should not reach to that maximum limit because it might affect the credit limit. At the same time, issuers tend to get worried when you reach there, so you might face some limitations. Pushing so far means that you are low on money, hence the reasons to worry.
Other factors to consider include:
- Fees and rates
- Balance computation method
- Personal spending habits
In conclusion, credit cards with no annual fee are not so different from regular credit cards. Some companies issue these credit cards as special offers, while others try to compensate for a minus. This is not necessarily a major factor in making a final choice, so focus on more relevant details instead.