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Credit Card Interest

Discussion in 'Members' Lounge' started by GSRCRXsi, Apr 9, 2010.

  1. GSRCRXsi

    GSRCRXsi Super Moderator Moderator VIP

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    so i have a few credit cards. i have a Best Buy store credit card and a Platinum card from my bank (BB&T). im not even going to try and calculate my best buy cards interest rates because it varies on purchase. but ive always been confused about my BB&T Platinum cards interest rates. when i signed up for it i was given the best card, the platinum. when i asked about the interest rate she said something like "prime+ 5%" or something, and that the prime could fluctuate. this was like 4 years ago. i figured the interest rate would be around 10-11% and that seemed pretty good to me at the time. when i opened they gave me a $1000 limit.

    so i never really paid any attention to the interest charges, i just paid my bill online and threw the paper statements in the shredder. sometimes i didnt even open them lol. i can keep track of the charges online as well. ive always carried some balance, but ive always paid on time and paid at least 100 every month. safe to say i used the card pretty regularly. well i wanted to get a balance increase, and didnt think it would be a problem since ive used the card so much and had it a good while. plus i have great credit. they asked me how much i want, i said 5k, they approved. wonder how much i could have gotten, lol. but i dont need a 20k card or anything.

    so tonight i decided to calculate the interest based on the charge and the balance.

    so my balance was $892.28, interest charge this month was $4.49
    4.49/892.28x100 = ~0.50
    0.50x12 months = ~6% APR?
    did i do that right? seems crazy low for a CC bill, i hear about all these crazy interest charges like 20+%. or is my card just that awesome?

    just paid off the BB card now, and im going to cancel it when it all clears. and i think im going to keep just this card since ive had it for so long.
     
  2. Briansol

    Briansol Admins Admin VIP

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    interest on credit cards is APY and compounded daily most of the time at a rate that equals X%.

    This should all be clear at the bottom of your statement.


    my main card is 7% and my back up card is 11%.

    Anyone holding or using a 15%+ card is retarded and/or needs to learn how to manage their money better.
     
  3. GSRCRXsi

    GSRCRXsi Super Moderator Moderator VIP

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    so did i roughly calculate it correctly?
    and what exactly is this prime+whatever% business?
     
  4. Briansol

    Briansol Admins Admin VIP

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    prime rate is set by the fed reserve. thats what CC pays to them to borrow. you pay + X % to use the CC over that amount.
     
  5. 95b16coupe

    95b16coupe New Member

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    *threadjack*

    i pulled out money on my credit card the other day. new "cash front end fee" of $10. cocksuckers got me on a new one.

    i fucking hate credit cards.
     
  6. eg6sir

    eg6sir Supa Mod Moderator VIP

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    only credit card i own is a jewelry store card.. lol.. no real credit cards, i supposed i could have gotten some when i turned 18, but i had no way to pay for them and i was asking for trouble if i had gotten them.. lol
     
  7. reckedracing

    reckedracing TTIWWOP VIP

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    credit card interest is not calculated on the end of the month balance
    if you don't pay if off every month they calculate the amount of debt you used
    so if you put 5k on it, but then pay off 4999, they will charge you interest on the credit you used
    basically the full 5000

    so cards average your daily monthly balances
    so you might be paying interest on the 5000 based on 29 days and the 1 dollar based on 1 day

    some cards break the apr into 365 and calculate it by the day
    i dont know if all cards compund daily, but its something to consider

    i dont have much experience with cc interest
    i had a balance once, and i paid off all but like 200 bucks of a 3000 bill, and i got hit with an outrageous interest charge, that i didn't understand until they told me they charge interest on the credit you used, not on the ending balance

    smart money = lower the balance and just pay it off every month
    you get to use the credit for 30 days with no charge at all to you

    or shop for a 0% card for the introductory 12 months or 18 months
    don't do a balance transfer, cause they charge you a fee for the transfer, the fee is that last thing paid off, and it has the highest interest rate
    (although to the new CC laws, the cc company is to apply all payments to interest and fees, and then to the highest apr principal)
    so when you get 0%, just rack it up with all your monthly bills, so you can positive cash flow to pay off your interest bearing card, and then you can pay it 100 bucks a month or something, but make sure you can get another 0% by the time this one runs out, and you have enough reserves/cash flow to pay off the balance by paying you months bills on the new 0% card)
    its a fun cycle, but in the end you realize that you are now 60 days "behind" on your bills, as compared to just the 30 days from one CC grace period
     
  8. B16

    B16 Super Moderator VIP

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    I haven't used a credit card in over 3 years. :)
     
  9. TurboMirage

    TurboMirage YEEAAAHHH VIP

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    credit card problems? no problem. all you need is scissors :)
     
  10. reckedracing

    reckedracing TTIWWOP VIP

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    credit cards are beneficial to build credit
    and if you pay them off every month and have a rewards card of some type you get "paid" for just paying your bills
     
  11. Korax

    Korax New Member

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    You can thank your president and current congress. Does no one pay attention to the news? The new rules set in place limit credit card companies. Basically now everyone pays for the people that don't pay on their cards. The way they are now going to recoup monies is by punishing all people with old tactics like usage fees, annual fees, ect. You know, the stuff they stopped doing to attract people to get their cards. If you payed your card on time all the time you got a low rate, if you didn't you were charged fees and higher rates. They aren't allowed to hike up rates like they did before. So you, the good payer, now pays for everybody. Isn't it awesome?

    <333333333333333333333333333333333 socialism.
     
  12. BrutalB83

    BrutalB83 Brutal Moderator Moderator VIP

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    :werd:

    Yes, you can get into trouble with them, but they're not 'evil', not by a long shot. Just like with a lot of things in life, you have to be responsible...
     
  13. 95b16coupe

    95b16coupe New Member

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    pretty much. say goodbye to 4% credit cards.

    once again, smart people get fucked because of the stupid, poor and lazy.
     
  14. reckedracing

    reckedracing TTIWWOP VIP

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    thats why all the companies jacked their rates up to the 30% max before the new laws went into effect

    or how about the old game or cutting credit limits to below the current balance so they get hit with over credit limit fees?
    and then once they get the over the credit limit, they are free to raise your rate to the max allowable under law
     
  15. GSRCRXsi

    GSRCRXsi Super Moderator Moderator VIP

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    also, i know a lot of credit card companies will kill your limit once youve paid off your balance. i know BB was doing it for a while.
     
  16. jeffie7

    jeffie7 Wrong Whole! VIP

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    I still get 0% offers. I honestly have no idea what my credit cards rates are. I use my credit card as a tool nothing more. Build points/rewords and pay it off at the end of the month. Don't have cash to spend? don't use the credit card. have cash to spend? put it in the bank and use the credit card and earn on it.

    Discover card at up to 5% cash back FTMFW!

    As far as using it for a personal loan, I do it from time to time and before hand always make a point to plan out how long it will be for and about how much I'll pay a month. For the most part I will never go past 3 months. If I can't make it happen then theres no reason I should be buying whatever it is I want to buy.
     
  17. jeffie7

    jeffie7 Wrong Whole! VIP

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    ditch the BB card. It's a one time use card and then cancel/trash it.

    If my main Visa and Discover card lowered my limit I'd call them up and tell them to go F themselves. Thankfully if you have really good credit they wont do that. When you fall into the iffy credit spot. iffy now adays might be anything under 720? it was 680 2 years ago... maybe its even higher now? if you fall under that # they will do anything they can to protect the card company, many people have seen a drop in limits.

    it has nothing to do with paying off early, I pay mine every month and leave a ZERO balance on it 95% of the time. My limit has only gone up over and over and over again even a few times this last year.
     
  18. 95b16coupe

    95b16coupe New Member

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    i used it for a cash advance because rent was due 2 days before pay day. i just invested all my cash the week before. i spaced out and didn't look ahead. i wasn't about to sell stocks because of $100 payment.
     
  19. jeffie7

    jeffie7 Wrong Whole! VIP

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    You used it as a tool. You had a plan and followed through with it.

    that's much different then getting a $3000.00 cash advance so you can buy a motorcycle or something.
     
  20. GSRCRXsi

    GSRCRXsi Super Moderator Moderator VIP

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    yea once my final payment goes through, the BB card is going bye bye. i really only got it so i could get 2 years no interest on a TV i bought (but ive used it here and there on other things) which i technically wasnt allowed to do since i was an employee, but fuck it, i found a loop hole lol.
     
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