Recently, changes in credit card revolving completed 6 months and this was even highlighted in a report with Good Lenders this week. According to a survey by Good Lenders, the interest payment decreased after the changes, but that does not mean that the Brazilian pays little. Credit card interest remains one of the most expensive on the market.
Thinking about it, we prepared a special post for you. Let’s remember what has changed in the new credit card rules.
What are the new credit card rules?
Since April 2017, who uses the credit card and does not pay the full amount of the invoice must stay on the revolving credit for 30 days. According to the National Monetary Council (CMN), the body responsible for implementing the new rule, after this period the consumer is taken to an installment credit plan.
Banks charge less interest on installments than on revolving ones. While the installment of the invoice is around 14% per month, the installment credit is around 8% per month.
To cite an example of how it works in practice, let’s say that for some reason you are unable to pay the full amount of the October invoice, paying only the minimum amount. Automatically, you enter the revolving credit for 30 days, that is, until the due date of the next invoice (in November). If you pay the invoice in the following month, you won’t have to worry anymore, but if you can’t, it should be transferred to the installment credit in June.
How to pay less interest?
Through a simulation made in the personal finance application Good Lenders, migrating from revolving credit to installment credit can be much cheaper, facilitating the settlement of debts.
For example: a person with a debt of $ 1,000 in revolving credit would pay, after one year, $ 2,213.76 in total. Under the new rule, spending one month on revolving credit and migrating to installment credit the following month, the consumer must pay $ 1,771.99 in total – a savings of $ 441.77 in the year.
To further reduce the amount paid in interest, consumers should research the rates for personal loans in the market, including those charged at their bank and online credit options.
How to pay off debts?
If you have more than one credit card, collect all invoices and negotiate with banks a better alternative to pay off debts. Since interest rates can vary widely between modes, do not let the bank choose the plan automatically. The correct thing is to research and negotiate better rates or request a more attractive modality for you.
How to safely use the card again?
The credit limit will be reduced if you enter revolving credit and, later, installment credit. But, when settling debts, use your credit card again analyzing how much you can pay, and not based on the limit provided by the bank.
Even with the new credit card rules that have been in effect for 6 months in the country, be responsible for using the card. Use it in a planned and moderate way, paying the invoice on time. To help, rely on a personal finance app and have more control over your spending.