Annual Percentage Rate (APR) for Purchases This section discloses the interest paid for purchases on the card. Multiple interest rates may be listed here, because thefinal interest rate may depend on the creditworthiness of the applicant
Introductory Rate If the credit card has anintroductory rate it will be shown in this section, which is the APR charged during the credit cardsintroductory period after a credit card account is opened. The card will have a different APR after the introductory period ends What is the introductory rate for this credit card offer? The introductory rate depends on the creditworthiness of the applicant, but it will be 12.99%, 13.99%, or 14.99%
Variable-rate APRSome cards will have a variable-rate APR, which is an APR thatmay change depending on other factors, such as the prime rate. The prime rate is an index thatrepresents the interest rate most banks charge their most credit- worthy customersWhat is the APR for Purchases for this credit card offer? 14.99% Is this a variable-rate APR or a fixed-rate APR? Variable-rate APR
APR for Balance TransfersThis section discloses the interest paid for balance transfers, which is the act of transferring debt from one credit card account toanother. Balance transfer fees mayapply, even if the balance transfer APR is 0% What is the APR for balance transfers for this credit card offer? 15.99%
APR for Cash AdvancesThis section discloses the interest paid for cash advances, such aswithdrawing cash from an ATMusing a credit card. Cash advance fees may also apply What is the APR for cash advances for this credit card offer? 21.99%
Penalty APR and When it AppliesThis section discloses the penaltyAPR, as well as the penalty terms that trigger the penalty APR to take effect•Penalty APR is the interest ratecharged on new transactions ifthe penalty terms in the creditcard contract are triggered What is the Penalty APR for this credit card offer? 21.99%
How To Avoid Paying Interest on PurchasesThis section explains how youcan avoid interest charges on a credit cardHow can a cardholder avoid paying interest on a credit card? By paying credit card bills in full by the due date
Minimum Interest Charge Credit card companies often have a minimum interest amount. These chargestypically range from $0.50 to $2 per month and aredisclosed in this section of the credit card offerWhat is the minimum interest charge for this credit card? $1.50
For Credit Card Tips from the Federal Reserve Board This section directs consumers to the Federal Reserve website to obtainmore information about credit cards
Set-up and Maintenance FeesThis section discloses any set- up and maintenance fees for the card, which can include annual fees, account set-up fees, participation fees, and additional card fees•Annual fee is a yearly fee thatmay be charged for having acredit card What is the annual fee for this credit card? $20
Transcation Fees This section discloses any transaction fees for the card, which can include balancetransfer fees, cash advance fees, and foreign transaction fees What is the fee for cash advances for this card? $5 or 3% of the amount of each cash advance (whichever is greater)
Penalty Fees This section discloses the penalty fees for the card, which can include late- payment, over-the-limit, and returned payment fees•Late payment fee is chargedwhen a cardholder does notmake the minimum monthlypayment by the due date•Over-the-limit fee is chargedif the account balance goesover the set credit limit Does this card have an over-the limit fee? Yes, the over-the-limit fee is $29.
How we calculate your balanceCredit card companies can use one of several methods to calculate the outstandingbalance on a credit card. The method used is disclosed in this sectionWhat method is used to calculate the balance on this card? Average daily balance (including new purchases)
Loss of Introductory APR If the card has an introductory rate, this area will list how the lowerintroductory rate can be lostHow can the introductory APR be lost on this card?If the cardholder is more than 60 days late in paying the bill What APR will the cardholder be charged if the introductory rate is lost? The Penalty APR of 28.99%
Summary of Account ActivityThis section includes payments, credits, purchases, balance transfers, cash advances, fees, interest charges, amounts pastdue, the new balance, available credit, and the last day of the billing period How much did Andrew charge in new purchases during this credit card billing cycle? $529.57
Payment InformationThis section includes the total new balance, the minimumpayment amount, and the date payment is dueWhat is Andrew’s minimum payment due for this billing cycle? $53.00
Late Payment Warning This section states any additional fees and the higherinterest rate that may be charged if a payment is late How much is Andrew’s late payment fee? $35
Minimum Payment Warning This section includes anestimate of how long it can take to pay off a credit card balanceif only the minimum payment is made each month, and an estimate of the total amount paid, including interest, if the bill is paid in three years(assuming no additional charges are made) How long will it take Andrew to pay off the balance of his credit card if he only pays the minimum payment? 10 years
Notice of Changes to Your Interest Rates If a cardholder triggers the Penalty APR, the credit cardissuer must notify them on theirstatement that their rates will be increasing Has Andrew triggered the Penalty APR? Yes, he will pay 28.99% on all transactions made after 4/9/12.
Important Changes to Your Account TermsIn this section of the statement,cardholders must be notified of any raise in rates or fees or anyother significant changes to the account Other than implementation of the Penalty APR, will there be any other changes to Andrew’s account terms? Yes, his APR for Purchases is increasing to 16.99%.
TransactionsThis section includes a list of all the transactions that haveoccurred since the last statement (purchases, payments, credits, cash advances, and balance transfers). This section should be carefully reviewed by thecardholder to ensure there are no unauthorized charges or errorsHow much did Andrew charge on his credit card to Store #1? $529.57
Fees and Interest ChargedCredit card issuers must list the fees and interest charges separately on the monthlystatement. Interest charges mustbe listed by type of transaction Did Andrew pay a late fee? Yes, he paid $35.00 for a late fee.
Year-to-Date TotalsThe total amount paid in fees and interest charges for thecurrent year must be shown on the statementWhat is the total amount of interestAndrew has paid in the year 2012? $18.27
Interest Charge CalculationThis section includes a summary of the interest rates on the different types of transactions,account balances, the amount ofeach, and the interest charged for each type of transaction What interest rate is Andrew paying on cash advances? 21.99%