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A credit card is a card that is provided by credit companies that offer you
credit in advance with a promise from the customer to pay. There are so many
different credit cards in the world today, there are the 4 major cards, MasterCard,
Visa, American Express and Discover. Plus store cards and millions of other
companies offering you credit.
How it works is that you apply for the card or in some cases the credit card
companies will offer you a card. You fill out the application which normally
include your name and address, your social security number and your phone number.
They will ask for your occupation and salary as well as if you have a bank account
and if so how many.
They will ask you what card do you want a MasterCard or a visa and you sign
the bottom of the application. You mail in the application and wait to see if
you are approved. If you have good credit then most likely you will get approved
and if your credit isn't up to par then you may get declined. These days
you can apply online and see if you were approved or not in minutes.
If you are approved you will get the card in mail and chances are that you
will have a high interest rate. An interest rate is a charge that the credit
card companies impose on you when you do not pay your bill on time every month.
That is really how people get into trouble because they get credit at a young
age and start buying the things they could afford and then before they know
it you owe more money that you can afford to pay back.
If you are going to have credit cards here are some tips for you to
follow:
1. Try to negotiate a lower interest rate. If you have had your card for a
while the credit card companies may work with you.
2. Don't spend more than you can pay back. This is where the interest
will get you. By all of the interest charges adding up, chances are unless you
win the lottery you will not be able to pay back that debt.
3. Try not to have more than 2 cards. Keep one aside for emergencies.
You can successfully have credit cards if you keep control of what you are
spending and spend wisely.
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