Credit Card Basics
What is a CVV number
A 3-digit security code on the back of the card used for online transactions.
What is the considered a "good" credit score?
650+
What is a debit card?
A card linked directly to your checking account that deducts funds immediately when you make a purchase.
Is there a daily purchase limit?
Yes, banks set daily limits on how much you can spend ex. $2,500 and withdraw ex. $300.
Does paying late affect your credit score
Yes, it can lead to late fees and significantly damage your credit score.
How do credit cards work?
They provide a line of credit that you must pay back
How do I build credit safely?
Use a small portion of your limit and pay the bill in full and on time every month
What do you do if you loose your debt card and what are the risks?
Call the bank. Risks are fraud, money withdrawal, possible to be unreversible.
What happens if there is a temporary hold on your account?
Gas stations, hotels, and car rental agencies may put a hold on funds to cover potential final costs, which can exceed the actual purchase amount.
Does spending a lot on your credit card help your credit score
No using a large portion of a card’s credit limit won’t help your credit score. In fact, it might just do the opposite.This can be called credit utilization.
What is the payment due date?
The deadline to pay your balance to avoid fees and interest.
Am I responsible for fraud charges on a credit card?
No
Does a debit card help me build credit early?
No, debit cards are not linked to your credit score.
How long do authorization holds last?
Holds can last until the final transaction clears, often within 72 hours.
What is a "grace period" on a credit card?
A grace period is the time between the end of a billing cycle and the date your payment is due, during which no interest is charged on new purchases. To avoid paying interest, you must pay your full balance before the grace period expires
What is the statement closing date?
The end of the billing cycle when the issuer adds up your charges.
Why should you not close a credit card?
Closing a card can decrease your overall available credit, lowering your score.
Do you need to use a pin for every transaction?
No
What happens if you overdraw your account?
If you have overdraft coverage, you might pay a fee $25-$35. If not, the transaction may be declined.
Can you be charged a fee on your debit card?
You may face overdraft fees if you spend more money than is available in your account, or ATM fees for using a machine outside your bank's network. Some financial institutions also charge replacement fees if you lose your card.
What does APR stand for?
Annual Percentage Rate
How much should you pay back on your credit card?
You should pay in full to get the debt taken care of
What if an ATM eats my card?
Contact your financial institution immediately to report it and secure your account.
What is the difference between "actual" and "available" balance?
Available balance is the money you can use now; actual balance is the total in the account
What is "Zero Liability" protection?
It is a policy that ensures you are not liable for unauthorized purchases if your card is lost or stolen and reported promptly.