I’ve gotten a mixed of information among friends, and internet. I was hoping to solidify understanding using my current credit card balance as an example. So as long as I pay the minimum I will not have to pay interest? If I do have to pay interest would I be paying 29.99%/12 for however much I owe by the end of the month? Or does it accumulate and charge me at the end of the year?
Current Balance: $2161
Remaining Statement Balance: $0
Next Closing Date April 9th
Payment due: $0
Purchase APR: 27.49%
Cash advance APR: 29.99%
In: Economics
It depends on whether the credit card company has some sort of deferred interest deal but the situation you described sounds like the usual run-of-the-mill situation. For those, you will be making some small payment (if you’re just paying the minimum) and the interest will end up being way more than the principal by the time you pay it off.
Sometimes there are deferred interest deals where, as long as you get the entire balance paid off by the end of the deferred period, you get away with not paying any interest. These deals often have a bunch of fine print that you need to pay attention to. Otherwise they hit you with all of the interest that was deferred.
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