Common Student Misperceptions
mistakes are often duplicated. In this section, we hope to convey
to you some common "misperceptions" so that you can avoid
making the same mistakes.
day grace period" -
Most people in general believe that there is always 25 days of grace
before you are charged interest. This is the case only when you
have ZERO balance. When you do have a balance, interest is immediately
accrued from the moment you charge something to your credit card.
establishing credit because I have a credit card with my name on
Many students carry their parents card with their name on it. In
one way, it's great because they will pay the bill, but this does
not build credit. To build credit, you have to apply on your own.
It's well worth the effort to start building your credit history
while you are in school. You'll save big when
you borrow for your car. Also, you can carry your card when
you road trip, rather than your parents' card so that you won't
leave a paper trail of bills that detail your post Spring Break
only want to sign me up to make money on interest" -
That is only half true. What students don't realize is that every
time you use the card, Discover/Visa/Mastercard gets about 3% of
the transaction. For example, if you charge $100 at a restaurant,
the owner only gets $97! This money gets split up between the "processor"
and the "issuer". This money really adds up. Just think,
when you charge $1,000 a year you are generating $30 of revenue.
In short, even if you don't pay a nickel of interest, banks are
still making money!
let's see how a loan officer looks at you...