The easiest way to show you the differences are in a side-by-side comparison. There are so many ways for you to “pay” for your card that you really have to read the fine print. Start by comparing the “Fed Box” information required by law. The box on the left is the current information from Destinations Credit Union.
Below is the information from the same day (10/14/2010) from a major bank.
Teaser Rates Can Cost You More in the Long Run
Although this is a real bank, we’ll call it “Big Bank USA” to protect the not-so-innocent. Both the bank and Credit Union offer no annual fee and a 25 day grace period on purchases. Big Bank USA has higher rates than the Credit Union, though they are offering a teaser rate of 0% for the first 6 months. After that, they revert to the higher rate and you can see that they are much higher for cash advances. The Credit Union offers the same rate for cash advances and purchases. These higher rates and fees will add up to more than you’ll save on a teaser rate in many instances.
Big Bank is going to charge you 4% or a minimum of $10 if you transfer balances on to that card. That means for every $1,000 you transfer from a higher rate card to this one, you’ll pay a $40 fee. At the Credit Union, there is no balance transfer fee.
In reading the fine print on this offer, you’ll find that the bank offers rewards – 1 point for each dollar of purchases. The Credit Union offers the same reward, BUT there is a difference. Big Bank USA charges you a fee every month for participating in the rewards program….the credit union doesn’t