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 News from the financial sectors in Spain and the Canary Islands Credit cards Last resort finance Using your credit card as a way to pay for items month by month is very expensive, the APR is usually over 20 per cent and the possibility of getting yourself into a credit bind is very high.  The rate of interest charged can vary tremendously. In a recent report by consumer’s organisation OCU, they analised 19 different credit cards and found rates from six per cent with the Visa Clásica of Inversis Banco to 26.82 per cent with the Visa Clásica of Banco Santander and the Visa Cepsa of Citibank. Over half the cards studied offer the possibility of paying the majority of the debt off at the end at the month whilst allowing a particularly large purchase to be paid monthly. The cost of putting one item aside for monthly payment tends to be a much cheaper option than the normal monthly payment system, 9.9 per cent as opposed to 22.42 per cent for example in the case of VancoPopular-e’s Visa Clásica. However you should look at the fine print. Some banks make extra charges for this type of operation, for example Citibank’s Visa Cepsa charge five euros for each operation. If the purchase is only small the APR can be horrendous, if for example you decide to pay off 90 euros over three months under the special payment system the end APR is 80 per cent if you include this charge. Only five of the cards investigated gave a three month breathing period without interest (six months in the case of Caja Madrid’s Pago Seis). However the credit may be free of interest but not of costs as there are additional charges to, “formalise” purchases which hikes up the APR, especially in small operations, with the exception of Unicaja’s Mastercard which can only be used in a restricted group of establishments. For purchases of over 600 euros this type of card can be a good option. All the cards in the report allow the cardholder to draw cash either by transfers to a current account or by using a cash machine. In addition to the interest charged on the amount in question you have to add the commission charged for the transfer. The most expensive is the Caja de Ahorros del Mediterráneo who charge four per cent of the amount transferred. Cash machines can be even more expensive with charges up to five per cent if you have to use a bank chain other than your own. Most cards will simply block your operations when you reach your credit limit, others allow you to go a little over at the cost of a commission of up to four per cent of the amount overspent or a fixed charge which can be very high, for example Unicaja charge 20 euros. Problems get worse if you hold more than one credit card and fall for the temptation to spend up to the limit on all of them. If you can’t pay the monthly amount required they can charge you a commission for debt recovery of up to 35 euros and your overall debt will begin to be charged at overdue payment interest rates. If you can get back on track quickly you will probably be able to continue using your credit card without a problem, however if the debt persists the card will be cancelled and they will go to any extreme to recover the accumulated debt, interests and commissions. It could well end with an embargo on your possessions and your name in a debtors list which will mean that you will not be considered for further loans, credit cards or mortgages from any bank or credit company. How to make the most of your credit card Ideally use your card on a ‘pay all at the end of the month’ basis. Avoid the cards which oblige you to pay monthly and therefore get yourself into debt even if you don’t need it. Choose a card which will allow you to isolate specific purchases to pay off monthly. If your card doesn’t allow this, buy whatever it is you want to buy, but put the card to one side until the purchase is fully paid off. If you’ve got some extra cash in hand, make a full or partial early settlement of your credit card bill. Don’t use cash machines to take out money on credit. Be satisfied with just one credit card. You will be better protected against fraudulent credit card use and the possibility of getting into debt over your head. The full OCU comparison chart can be found at http://www.ocu.org/20100114/tarjetas-de-creeacute-dito-dinero-y-derechos-neordm-114-Attach_s479484.pdf. This article appears in the print edition 610 of Island Connections
| Canary Islands - 08.02.2012 - Yesterday's ugly scenes at Bilbao airport, where Ryanair boss Michael O'Leary had to be given a police escort after his provocation of former Spanair employees, prompted a furious reaction against the head of the airline by Canarian MP Ana Oramas. more... Las Palmas - 08.02.2012 - The snags preventing the release of tickets for the concert by rock legend Bruce Springsteen in Gran Canaria have now been resolved and the gig has been confirmed 100%, say the organisers. more... La Laguna - 07.02.2012 - A well-known Tenerife lawyer is the focus of police attention in a money-laundering and fraud investigation ordered by a La Laguna judge. more... Canary Islands - 07.02.2012 - Relations between the Canarian government and the new Spanish government sank further yesterday when the region's tourism minister was apparently snubbed by his national counterpart. more... Canary Islands - 07.02.2012 - Two Britons who had to be rescued again after getting into trouble on their bid to cross the Atlantic in a pedal boat could face a hefty fine for the latest mobilisation of air and sea rescue resources. more...    Banish the blues They tell us that this is one of the most depressing times of the year more...   | Elektronische Zigarette Kombiangebote Elektronische Zigarette 8,9cm mit der E-Zigarette Classic www.elektrische-zigarette.eu Rent a car Tenerife We have been in the rent a car business since 1976 in Tenerife. Our experience - your advantage. www.hermanns-cars.com Electronic Cigarette The Electronic Cigarette SLIM is recommended for smokers with few consume, occasional smokers and to go. www.liquid-shop.eu Real Estate Tenerife Tenerife Real Estate is your partner on Tenerife for penthouses, properties, fincas or business-pubs for the purchase and sale of villas, chalets, houses, appartements. www.teneriffa-immobilien.es ic media group |
