Credit Cards How To Use Credit Cards Wisely

How to Read a Credit Card Offer

Eric Rosenberg
Written by Eric Rosenberg

When you get a credit card offer in the mail, or email, it may come with exciting buzzwords and marketing lingo about low fees, big rewards, and other benefits. But what will the card really cost? Thanks to the Federal government, credit card issuers have to follow a clear template that explains the costs of a card in one place. Today, we are going to dig into that template so you know what to look out for and if a credit card might make sense for you.

What is a credit card offer?

A credit card offer is a public or personalized solicitation outlining the details of a specific credit card. Offers may be on a public website, like a bank or card issuer’s website, an email to you, or a direct mailing. It doesn’t matter where you come across it, all credit card offers have to adhere to a set of rules.

It is also important to recognize what a credit card offer is not. A credit card offer does not guarantee the issuer will approve you for the new card should you apply. It simply states that you may apply, and if you do and are approved these are the terms of the account.

Credit card offers are required to contain some specific information related to the costs of keeping and using the card. While the offer may not contain every detail you need to decide whether or not to apply, you should always review the offer details before signing up.

What information is contained in a credit card offer?

Because all credit cards are required to present the same information in the same format, we can look at any credit card to better understand what information you’ll see when you open up the offer pricing and terms. Here is a screenshot of the offer details for the Chase Freedom Unlimited credit card as of April 2018.


Here is a line-by-line breakdown of what you can find in any credit card’s pricing and terms details that come with a credit card offer. Today we are more concerned about what these terms mean than the actual values, but when you are deciding on a card you should look at every number on the terms sheet.

Interest rates and charges

Purchase Annual Percentage Rate (APR) – The APR, or annual percentage rate, is the borrowing cost for using a credit card. You can pay your card in full each month to avoid interest charges, but if you don’t pay in full and carry a balance from month to month, this is what you’ll pay to borrow those funds.

Balance Transfer APR – If you transfer a balance from another credit card, you may be charged a different interest rate. If the rate is lower, higher, or the same, it will be listed out separately from the purchase APR.

Cash Advance APR – If you want to get cash from your credit card at a bank branch or ATM, you have to pay a cash advance APR. Cash advance APRs are typically equal to or higher than the purchase APR. In the example above, the cash advance APR is equal to the highest purchase and balance transfer APR rates.

About the author

Eric Rosenberg

Eric Rosenberg

Eric Rosenberg is a finance, travel, and technology writer originally from Denver, Colorado living in Ventura, California. When away from the keyboard, Eric he enjoys exploring the world, flying small airplanes, discovering new craft beers, and spending time with his wife and baby girl. You can connect with him at his own finance blog Personal Profitability.

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