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01 September 2011

Controlling Credit Card Use When Having Home Loan


Credit card is like a magic card. Currency was in form of paper for many years and now we have a card. There are various financial companies that give credit cards on some amount of interest rate applied on the money used. There is a lot of competition like in home loans and various companies compete for customers to take their credit card. When using a credit card with our continuing home loan remember we have to pay back this money.
Well yes. You definitely have to pay back this money with a certain amount of fees for usage of the card or certain amount of interest applied to the amount used. The card is a walking currency that you have at your disposal. The company gives you authority to spend certain amount of money on purchase or other financial payments by swiping the card. Many shops and even phone and electricity bills can be paid by the card. Visa Card, ICICI card and other such companies have given money at your disposal. The customer has to pay back within a certain period of time to avoid interest charges. Every month the account slip indicates your expenditure form the usage of the card and this has to be paid back otherwise the interest keeps on accumulating on the spent amount.
There are many advantages for having a credit card and hence it has become very popular amongst many. Easy availability of money is one of them. Also there is no danger of traveling with lots of cash as there are safety and security hazards. Hence we usually get carried away with and over spend, many times during festivals and other family functions. This is one of the most important points we forget when we decide upon an EMI for our new home,  and that during festivals many times the budget goes off hand.
One can spend large sums from the card and repay at your convenience. But always remember its not your family fortune! you have to payback this amount and one must be very careful in usage of this money as many get carried away and spend large sums without keeping track of total expenditure and later face the crunch for payments! So when you have a continuing home loan keep a check to your credit card use and use it at a minimum. Try using cash for most purchases so that you can limit yourself to the amount you have at hand.

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