Page 66 - Credit Builidng Toolkit By Adrean Yancy jr 3

Credit Building Tool
What to Look out for When Selecting a Credit
Building Tool
While trying to build your credit with
credit-building tools, you must be
careful not to burn yourself along the
line. This is because choosing a tool with
a high interest rate could be disastrous
in the long run. Hence, you want to
check reviews before signing up for any
program; some companies have hidden
fees and clauses that can make them
difficult or costly to cancel later, so read
everything carefully before agreeing to
anything. Here are some of the things to
consider before selecting any credit-
building tool:
· The Purpose of Getting the Card:
Why are you planning to get a card? Is
the card going to be for emergency use,
or will it be used for payment for all
purchases? Are you getting it to build
your credit? These and other crucial
questions will help you make a good
decision. Of course, if you will be paying
your total bill monthly, there is no need
to worry about interest charges, and you
can always go for cards with an
extended grace period and zero annual
fees.
But if you will be carrying some balance,
stay away from cards with high interest
rates, no matter the perks. And if
possible, go for cards with the lowest
interest charges.
· The Card's Interest Rate: One of
the biggest hurdles in using a card is the
interest rate. You must check what the
card's interest fee is. Is it a fixed rate or a
variable rate? If the card comes with a
fixed rate, this way, you know how much
you'll be paying monthly, but a variable
rate is subject to change, and hence the
amount you pay monthly will vary.
We have come to understand that some
of these cards entice consumers with an
introductory rate or zero percent APR
during their promotional period. This
often draws many consumers who
forget that after the promotional period,
things might change and become
burdening. To avoid paying huge
interest fees, always make timely
payments and research their APR after
the promotional period.
63