MGMT 4A Chapter Notes - Chapter 3: Annualcreditreport.Com, Mortgage Insurance, Annual Percentage Rate
Document Summary
How to build your credit and boost your credit score part 1. You have to pay penalty interest of 25% Yes, companies can charge rates way above rae in general economy. You decide to cut up your credit card and 7 years later you would have paid over. ,800 in interest alone (way more than starting balance) But you haven"t spent a cent since cutting your card up. Interest you pay very sensitive to your apr (annual percentage rate) A balance with a 16% apr. Takes 4. 8 years an in interest to pay off. Key point: paying just the minimum balance every month is a losing move. When you only pay the minimum balance, the credit card company loves it. They love it because you fork out interest payment at high rates yet never default. Bank makes more money --you lose money! Big tip: pay off credit card balance asap to avoid big interest payment at high rates.
