ECONOMICS
CREDIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Paying the minimum.
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Missing a credit card payment.
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Paying off the full balance.
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Cashing in on rewards points.
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Detailed explanation-1: -Your APR rate may have increased due to the following reasons: You missed a payment: Penalties for missing your monthly credit card payment include late fees as well as increases to your APR.
Detailed explanation-2: -If you don’t make the minimum payment on time, the late payment could be recorded on your credit reports. This generally stays on your reports for seven years. If your payment is 180 days late, your lender may declare it a charge-off. This means that the issuer takes it off their books, but you still owe the money.
Detailed explanation-3: -Credit card companies take your credit score into account when setting your APR, with a higher credit score generally translating to a lower interest rate. Credit cards often have a variable APR, meaning your rate can go up or down over time.
Detailed explanation-4: -For many reasons, your credit card issuer may increase your annual percentage rate, or APR. This is one of the terms most likely to change for your credit card-and it can affect your account big time when it does.
Detailed explanation-5: -Depending on your card, things like missing payments, making late credit card payments, going over your credit limit or failing to make the minimum payment might trigger an APR increase. You could lose the introductory rate, too.