What are “Teaser Rates” on a Credit Card?

“Teaser rates” (also known as “introductory rates” and “promotional rates”) are just that: low annual percentage rates (APRs) that are used to entice people to apply for a certain credit card. Unfortunately, these rates may not last long.

Most teaser rates expire and revert to a higher rate after six to 12 months. Specific policies are set by a credit card issuer. As a result of the 2009 CARD Act, teaser rates must be in effect for at least six …

How Long Can Negative Information Remain in a Credit Report?

A consumer reporting company can report most accurate negative information for seven years and bankruptcy information for up to 10 years.

There is no time limit on reporting information about criminal convictions; information reported in response to your application for a job that pays more than $75,000 a year; and information reported because you’ve applied for more than $150,000 worth of credit or life insurance.

Information about a lawsuit or an unpaid judgment against you can be reported for seven …

What will it cost to make minimum payments of 4% ($40) on a $1,000 outstanding credit card balance?

According to the Credit Card Smarts Calculator from Advantage Publications, a $1,000 debt on a credit card that has an 18% annual percentage rate (APR) repaid by making 4% minimum monthly payments will take 6 years to pay off and cost $1,465, including $465 in interest. This assumes that no additional charges are made. If you can pay 6% of the outstanding balance ($60 per month), you will cut the repayment time by two years and save $399 in interest.…

Is it a good idea to freeze your credit?

It depends. You’ll need to weigh the benefits against the costs. Benefits include blocking access to your credit file by potential identity thieves. Costs include both time and fees. Credit bureaus typically charge $10 per request to implement a freeze. And then there is the inconvenience of (and an additional fee for) temporarily “thawing” your frozen credit, if necessary, to obtain new credit lines.

Some financial experts have noted that the credit freeze process is cumbersome and may not be …

What is a ChoicePoint report?

A ChoicePoint report is a type of credit report that is used by insurance companies, landlords, and employers to make decisions about the character and creditworthiness of applicants. ChoicePoint is a “data aggregator” firm that combines information from a variety of public and private databases and sells it to private sector firms and government agencies. The company had several high-profile security breaches during the 2000s. Consumers can obtain a free copy of a ChoicePoint report about them if one exists.…

How do credit card companies determine the balance on which interest is charged?

Over the years, credit card companies have developed several different methods for computing the balance on which credit card finance charges are calculated. Federal law requires creditors to state the Annual Percentage Rate (APR) when referring to interest and the method used to compute the unpaid balance on which interest is charged.

Below is a description of some methods for calculating the unpaid balance on a credit card and how different calculations affect finance charges. These calculations were made by …

I have a balance of $17,000 on a car loan. I’m currently paying $439 per month. I would like to knock some years off this loan. How much extra should I pay on this loan to make this happen?

The calculators at PowerPay will allow you to enter your balance, current payment, and interest rate to determine the time and cost for repaying a debt. (Use the additional payment calculator from the menu once you get to the PowerPay site). You can try various debt repayment scenarios and find one that works for you. Without knowing your loan interest rate and original loan balance, it’s not possible to figure this out for you.

But if we put in some …

What are the pros and cons of rent-to-own stores?

Rent-to-own (RTO) stores sell items such as furniture and appliances to consumers on an installment payment basis. RTO agreements usually consist of a rental contract that is renewed on a weekly or monthly basis. Usually, the terms are for 78 weeks or 18 months.

The customer has the option at the end of the rental period of whether to renew the lease or return the item. If the customer chooses to continue renewing the contract, payments continue to be made …

What is a penalty APR on a credit card?

Penalty annual percentage rates (APRs) are high interest rates that can be triggered by the slightest infraction such as just one payment that is received a day late. Often these APRs range from 20% to 35%. Lenders increase borrowers’ interest rate significantly and profit from their mistakes.

As a result of the Credit CARD Act, the only way a credit card company can apply a Penalty APR to an existing balance (i.e. purchases you have already made) is if you …

I think someone has stolen or is trying to steal my identity. What should I do?

  1. Contact the fraud departments of any one of the three consumer reporting companies (Equifax, Experian, or TransUnion) to place a fraud alert on your credit report.
  2. Close the accounts that you know or believe have been tampered with or opened fraudulently. Use the ID Theft Affidavit available from the Federal Trade Commission’s Web site www.ftc.gov when disputing unauthorized charges.
  3. File a complaint with the FTC. Print a copy of your complaint to provide important standardized information to the police.
  4. File