American Express: American Express, often referred to as Amex, is an international credit card issuer.
Annual Fee: A fee charged by a credit card once a year for it use. Not every card charges this yearly fee.
Annual Percentage Rate: The APR is the interest that is charged onto your credit card each month there is a balance.
ATM: This stands for Automated Teller Machine. At these machines you can insert your credit or debit card and withdraw cash either from your checking account or to be charged to your credit card.
Available Credit: This is the amount that you could still charge to your card. If your credit limit is $500, and your balance owed is $300, then your available credit is $200.
Average Daily Balance: This is the amount used to figure your payment. Each day’s balance is added together and that number is divided by the number days in one billing cycle to determine this number.
Bad Credit: If your credit rating is poor, you’re said to have bad credit. One way to get bad credit by using credits cards is to miss payments, make late payments, charge over the limit or to default completely by not paying and doing something like filing bankruptcy. You can get bad credit it many other ways besides using credit cards. How you handle car payments, mortgages and other loans and bills can also affect your credit rating.
Balance: This is the amount you owe on your credit card.
Balance Transfer: This is the practice of taking the balance of one credit card and transferring that amount to another card. Often, the balances of several cards are transferred at one time to a single card, usually to take advantage of a low APR on that card and to save money. Some cards charge a balance transfer fee when you transfer balances onto them.
Balance-to-Limit Ratio: Also known as a utilization ratio, this is a calculation that’s used to help determine your credit score. It’s the comparison of your balance (what you owe) to how much total credit you have. The lower the ratio, the better it reflects in your credit score.
Billing Cycle: The period between billing statements, which is typically 28 – 31 days and varies by card.
Billing Statement: This is the statement you receive which will show all the details of your account like balance owed, credit limit, APR, and things like purchases, ATM withdrawals, payments and interest charged during that billing cycle.
Cash Advance: A withdrawal of cash to be charged onto your card, usually from an ATM or bank. The interest is typically higher than on purchases.
Chargeback: A transaction that gets refunded to your card, like a store return.
Credit Card: Commonly called a charge card, this is a card issued to you by a bank or card issuer. You may use it to make purchases or take cash advances against your credit limit.
Credit Limit: The amount of total credit is available to you, also called a credit line.
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