Credit Card Vocab Terms (Schumer Box)

Introductory APR

• A special lower rate (often 0%) offered for a limited time when you first open a card.

• A fee charged for late payments on a credit card.

• The maximum interest rate that can be charged on a credit card.

• A reward program for frequent card users.

APR (Annual Percentage Rate)

• The yearly interest rate charged on unpaid credit card balances.

• A fee charged for late payments on credit cards.

• The minimum payment required each month on a credit card.

• The total amount of credit available to a cardholder.

Foreign Transaction Fee

• An extra charge for purchases made in another country or currency.

• A fee for using a credit card internationally.

• A tax imposed by the government on foreign purchases.

• A penalty for failing to report foreign income.

Penalty APR

• A standard interest rate applied to all cardholders.

• A higher interest rate charged if you break the card’s rules (like missing a payment).

• A fee for exceeding your credit limit.

• A reward rate for timely payments.

Annual Fee

• A yearly charge just for having the credit card, even if you don’t use it.

• A one-time fee for applying for the credit card.

• A fee charged for late payments on the credit card.

• A monthly fee for maintaining the credit card account.

Minimum Payment

• The total amount due on your credit card bill.

• The smallest amount you must pay on your credit card bill to avoid penalties.

• The amount you can pay to earn rewards on your credit card.

• The maximum amount you can charge to your credit card.

Cash Advance

• Taking out cash using your credit card, usually with high interest and extra fees.

• A method of transferring money between bank accounts.

• A type of loan with low interest rates.

• A way to earn rewards on your credit card purchases.

Grace Period

• The time between a purchase and when interest starts if you don’t pay in full.

• A period during which you can return a purchased item without penalty.

• The time allowed for making a payment before a late fee is applied.

• A duration in which you can apply for a loan without interest.

Cash Advance Fee

• A charge added when you withdraw cash using your credit card.

• A fee for late payments on your credit card.

• A penalty for exceeding your credit limit.

• A charge for foreign transactions made with your credit card.

Creditworthiness

• A measure of your income level and savings

• How reliable you are at repaying debt, based on your credit history.

• The total amount of debt you currently have

• Your ability to invest in stocks and bonds