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I got a new CC recently and I decided to read the terms. I even had to call them to clarify, because it was confusing.
The long and the short of it was this.
You have 21 days to pay for purchases from the time of the purchase, without incurring interest charges. This basically means you have to pay your credit card bill TWICE a month in order to avoid interest.
If you don't pay for a charge within 21 days, they charge you for all 21 days of interest going back to the day you bought it.
Furthermore, let's say you make a purchase of $1,000 and want to pay in increments for example. Day 1 you make the charge. Day 30 you pay $333. Day 60 you pay $333. Day 90 you pay $334. Finally, on day 120 you pay the interest you incurred.
How much do you think you paid in interest?
On day 119, you're still paying interest on all $1,000 + all interest!!!!!!!!!!!
Just because you made payments doesn't mean shit. You need to pay ALL $1,000 plus interest for them to stop charging you interest on the whole thing.
This especially applies to say balance transfers from higher interest cards. Since it's a "cash advance" you don't even get the 21 day grace period, and if you transfer like $10,000 over, even though you're paying "less" interest, you'll be paying their rates on the WHOLE thing until it's paid off.
Scary.
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