One of the easiest and fastest ways to get yourself into a lot of debt are credit cards. Credit cards are revolving debt. Interest rates is the charge or fee companies will charge you for using their card. Rule of thumb: when it comes to interest rates - the higher your credit score the lower your interest rate, the lower your credit score is the higher your interest rate. Credit limit is the "AUTHORIZED" amount the company has given you to use. lets say you have a credit card with a $300 limit and you go over the limit by $1; you have just violated your agreement. You are now in "Universal Default." Your interest rate will possibly double, your credit score will decrease by at least 80 points and to add insult to injury the rest of your creditors will be notified and there is a great possibility any other revolving debt you have the interest rates will possibly increase as well. Just because you got approved for a new car does not mean you will get approved for an unsecured credit card. Credit cards are credit score driven.
Posted on: Fri, 06 Sep 2013 16:39:40 +0000
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