It seems like loan companies have been using incentives as a way to attract people to apply for plastic forever. And because the competition in this field is quite stiff, many companies in this field offer different incentives that will make people choose them over their competitors. And one such incentive that they present and the one that is very appealing for most people are the lower or no fee credit cards.
The fee here usually refers to the annual service fee being charged yearly by the card provider to the card user. You could say that with this annual fee, the loan company is actually charging you for the mere use of their card. Thus, the no annual fee credit card means a completely free credit card.
You should also know that the charging of annual fees can be the bank’s way of making up for the savings that you can get for obtaining your card from them. To explain this better, here is an example, the card company may give you lower interest rate but the annual fee is a lot higher. This means, if you will try to calculate the figures, the savings that the company is referring to is actually equivalent to the amount that you have to pay in the annual fees. And as a growing number of people are beginning to get the picture, most of them are now searching for the glossy plastic cards that have low or no extra fees at all.
To be able to find a no annual fee account card, you must shop around and compare all the options that you will gather. Through comparison, you will see which card can really give you the lowest fees.
Furthermore, credit card companies will normally waive the annual fee for only a certain period of time; however they will increase the interest rates in order to compensate for the lack of annual fee. In this case, the most important thing that you should ask the company is how long that the no fee is in effect and how much you are liable to pay when the period for the no fee ends. So you see, if you want to get the best deal, you must do your research, inquire, and learn as much as you can about the various cards.
In any case, just as with any other credit cards out there, these no fee cards have their benefits and disadvantages too. Hence, even if its name hints at no payment of fees, there are actually some fees that apply to it. Listed here are some issues which you have to know:
1. When you have reached and go beyond your credit limit, the issuer of your card may charge you a fee. The good thing is that there are card providers who do not impose a fine for going over the limit.
2. The card issuer may ask you to pay a service charge in case you weren’t able to pay your account dues in full.
3. In the event that you made your payment after the due date, they will charge you with late payment fees and other charges that they deem applied.
