Annual Percentage Rate - The APR measures the cost of credit, expressed as a yearly rate. This "cost of credit" may also be measured as a "periodic rate" (APR divided by the number of billing periods in a year) or a "daily percentage rate" ( the APR divided by 365) depending on how the finance charge is calculated

The annual percentage rate, along with the "periodic rate", must be disclosed before you become obligated on the account. If it's not included in the Terms and Conditions section of the credit card offer, this information can be found in the Credit Card Agreement sent to you with your new card. Be sure to review this information before activating your card.

Your credit card agreement must also tell you whether your APR is "variable" or "fixed". A variable APR is tied to an economic indicator, called an index. When the index changes your APR may change as well. If your card is a variable rate card, the issuer must disclose to you 1) that the rate may change, 2) how the rate is determined (i.e. which index is used and what additional amount or "margin" is added to determine your new rate, 3) how much and how often your rate may change.

A fixed APR credit card is not tied to any index so the rate will not fluctuate like that of a variable rate card. This doesn't mean your APR will never change, but generally it will not change as drastically or as often, and the card issuer is required to give you ample notice before changing your rate.

Grace Period - Also called a "free period," a grace period gives you a window of time to avoid finance charges if you pay your balance in full before the due date. Cards without a grace period begin charging interest as soon as a purchase is made. If you card offers a grace period, the issuer is required to you're your bill at least 14 days before the due date so you will have enough time to pay off your balance in full.

Annual Fee - Many credit card issuers charge annual membership or participation fees. These fees are most common to business cards, travel and rewards cards, and cards for those with new or damaged credit. Fees may range anywhere from $25 to several hundred dollars.

Transaction Fees, Penalty Fees and Other Charges