Credit Card Processing – Discount Rates and Transaction Fees

January 28th, 2015 by admin

In the competitive business environment that exists today, it is critical you give your customers many options to pay you for your products and or services.

Setting up a merchant account so you can accept credit cards from  your customers is one of the most, if not the most, important initial decisions you’ll make when you start a new business. The following article will explain discount rates and transaction fees so you are better prepared when it comes time to pick a company for credit card processing services.

Discount rates and transaction fees go hand in hand. These are the fees you pay to process a credit card transaction. The discount rate is a percentage that is deducted from the total amount of the sale. For example: If your qualified discount rate is 2.20% and you charge a customer’s credit card $100, then you would pay $2.20 to process that transaction. But that is not all – you also pay a transaction fee as well. If you have a transaction fee of 25 cents, then your total cost to process that $100 dollar credit card transaction would be $2.45.  

What do you mean by qualified discount rate? The discount rate you pay will not always be the same percentage. It will change based on a number of factors, such as card type and how you actually process the card. Most personal debit and credit cards will fall into the qualified rate category. However, if you take a corporate, business, government, international, or personal rewards card, you will pay a higher discount rate on these types of cards. The discount rate on these types of cards can range from 1% to 2% over the qualified rate. This means that if your qualified rate is 2.20% and you accept an international card, your rate could be as high as 4.20%. Over time this can add up, so it is very important you factor this into your pricing when deciding how much you are going to charge for your product or service, especially if your plans include doing a lot of business to business transactions or selling internationally.

Another factor that influences the discount rate you pay when credit card processing is how you process the credit card. Merchants that swipe credit cards usually pay a lower discount rate than merchants that key in credit cards using an internet merchant account. The qualified rate for a merchant that swipes credit cards will usually be close to 1.80% but a merchant that keys in their transactions will pay a qualified rate of 2.40%. The reason for this is risk. Visa/MasterCard feel there is less risk of the transaction being fraudulent or disputed if the customer is present during the transaction and the merchant is able to swipe their card through credit card processing hardware or software.

Most credit card processing companies will only refer to their qualified rate when they advertise or try to sell you over the phone – so it is important you ask about qualified, mid qualified, and non qualified rates too when choosing a company for credit card processing services.

3 Credit Tips that Will Save You Hundreds Each Year

January 26th, 2015 by admin

While extremely convenient, credit cards can be a very costly consumer product. Most people don’t realize just how expensive carrying around a credit card in your wallet can be. Each year many big spending credit card consumers can throw hundreds or even thousands of dollars out the window using credit cards. Even if you’re not a big credit card spender, almost anyone can save hundreds of dollars each year with these 3 credit card tips.

Never Pay the Minimum Payment

Your credit card company usually makes sure you know that there is a minimum payment. Even if you owe thousands of dollars, your minimum payment can seem extremely low, sometimes only 3% of your total balance. However, what the credit card companies don’t tell you is that if you have a large balance and only pay the minimum payment for the next few years you will cost yourself possibly thousands of dollars in interest costs alone. In fact, that purchase at the record store for $50 over time will double. To avoid paying interest only and never touching the principle make sure you always pay more than just the minimum payment.

Transfer Your Balance to a Lower Interest Credit Card

Most Americans receive several credit card offers each month and most have some very enticing interest rate offers. For instance, many credit card offers will transfer your existing high interest rate credit card for free to the new card and allow you either zero percent interest for 6 months or a very low interest rate for a specific period of time. If you have a high balance in which you pay hundreds of dollars each year on interest payments, in many cases it is in your best interest to accept these offers and enjoy zero or low interest for the next 6 months to a year.

Use a Debit Card Instead of a Credit Card

It’s no surprise that many times we use credit cards out of habit. But why use something that is so expensive when we don’t need to. We can easily pay for that meal or fill up our car with gas with our debit card and not pay any interest. Debit cards are just as convenient as credit cards and usually accepted everywhere credit is as well. Use your debit card to avoid high interest fees in the long run and you can literally save hundreds in interest fees each year.

Credit Card Debt Consolidation – How to Bundle Credit Card Debt and Eliminate 50%

January 26th, 2015 by admin

It all begins and ends with your credit score. If you anticipate a severe reduction in your credit score because of your financial problems, you can take steps to exploit it to the fullest before you lose the same. If you have a lot of credit card debt, you can make use of the credit score and get an affordable consolidation loan.

As a name suggests, this loan involves getting a single loan to repay all of the other loans so that all your financial transactions are consolidated. Once this is done, you will find it easier to make a repayment to single credit card issuer. However, what is the use of going in for consolidation if you anticipate problems in repayment.

Well, if you owe five thousand dollars to ten different credit card issuers and if you are finding it difficult to repay the debt, you may not find them in a very enthusiastic mode as far as debt settlement is concerned. Since you owe just five thousand dollars, you do not represent a significant risk.

Credit card issuers often reserve settlement deals for those who owe more than seven thousand five hundred to ten thousand dollars. Now, if you combine your five or seven credit cards worth five thousand dollars each, you will have a total debt of thirty five thousand dollars owed to a single credit card issuer.

Now, you can easily ask for a fifty to sixty percent discount along with an installment facility to repay the same. Once you have this deal in your hand, you can get in touch with all other remaining credit card issuers and discuss how you desperately need assistance.

Even a forty percent discount on the debts worth five thousand dollars should be sufficient to reduce the same to manageable levels. The remaining credit card issuers will not have any choice really because they do not want you to file for bankruptcy just because you could not repay a five thousand dollar credit card debt.

This consolidation come settlement approach will be very useful if you have planned your finances and if you are aware of the complications that will arise in the future.

Reading all this in theory is fine. However, implementing this in practice can be very difficult. This is why you should make use of the services of professional service providers. They will give you a clear idea of where you stand and the actual tactics and strategies that you should follow to get rid of your debt problem.

California and the Homebuyer Tax Credit

January 23rd, 2015 by admin

People in California can celebrate that when they get their first home in California because there are several ways in which they can save money just from purchasing a brand new home. This will be a short guide on the homebuyer tax credit in California.

To get this tax credit is great for these families and individuals because it helps them save quite a bit of money. There are other ways to help with the purchase because the state and federal government are providing funds to new homeowners. Aside from this tax credit, there are state and federal grants which help to pay for down payments and closing costs, so these are very helpful and one should seriously apply for them.

To get this tax credit, one first needs to buy and close escrow on a home between May 1, 2010 and January 2011. What the credit is is a 10,000 dollar credit. If five percent of the home of the price is less than 10,000 dollars, that amount will be given instead. This tax credit is awarded over three years, and each year would be a maximum of 3,333 dollars per filing.

The maximum that the government can award all new homeowners is one hundred million dollars. Therefore, anyone who wants to apply should do so as early as possible because there is only a certain amount that can be handed out.

To find out more about this tax credit, one should visit the California state website to find out more details. There are several requirements to be met before applying. This is a very useful solution for people looking to save money on the purchase of a new home. There are other options to apply for such as state grants and federal grants to help people lower the cost of an expensive home in California.

New Credit Card Offers From American Banks – Benefits and Detailed Description

January 22nd, 2015 by admin

There are hundreds of credit card offers available in the market. The credit card companies compete against each other with attractive incentives such as cash back, points reward schemes and balance transfer offers at zero percent. There are lot of new offers have been introduced in U.S by worldwide banks. Let see some good deals and their detailed descriptions.

BoatU.S.™ Platinum Plus® Visa® Card: This card offers 0% Intro Annual Percentage Rate (APR)on balance transfers and cash advance checks for the first 12 billing cycles. The card user can earn 1 point for every net retail purchase dollar spent and also he can redeem points for travel, merchandise, gift certificates, and cash. Provides Access to the MyConciergeSM service, a unique personal assistance service. There is absolute fraud protection against unauthorized use, online and offline. And there is no annual fee.

Bank of America Visa® Platinum Plus®: This card offers 0% Intro Annual Percentage Rate (APR)on purchases and balance transfers for the first 6 months.There is no no annual fee. The Credit lines as high as $25,000. Provides online Banking Service and Total Security Protection.

Bank of America® WorldPoints® Platinum Plus® MasterCard®: This Card offers 0% Intro Annual Percentage Rate (APR) on balance transfers and cash advance checks for your first 12 billing cycles. The card user can earn 1 Point for every dollar you spend in net retail purchases. Points are redeemeable for cash, brand name merchandise, travel with no blackout dates dining certificates and more. There’s no annual fee, free 24/7 Concierge Service and Absolute Fraud Protection.

Financial Rewards® Visa® Platinum Plus® Card: This card offers 0% Intro Annual Percentage Rate (APR) on purchases and balance transfers for the first 6 billing cycles. The card user can earn 5 bonus points with your first purchase. The earned points do not expire for 5 years. There’s no annual fee, provides online banking service and Total Security Protection.

TripRewards® MasterCard® Credit Card: This card offers 0% introductory APR on balance transfers and cash advance checks for the first 12 billing cycles and the card user can earn 2 points for every $1 in net retail purchases and earn 13 points for every $1 spent for qualifying TripRewards hotel stays. There’s no no annual fee, provides 24-hour online access and Absolute Fraud Protection.

Bank of America Student Visa® Platinum: The Intro APR is 19.24% and there’s no intro period and no annual fee. This card helps the card user to build his own credit history. No cosigner required for this card. provides features like online banking service and Total Security Protection.

Bank of America Rewards™ American Express® Card: This Card offers 0% Intro Annual Percentage Rate (APR) on balance transfers and cash advance checks for the first 12 billing cycles. There is no annual fee and the flexibility to pay over time. The user can reedeem the points for travel with no blackout dates, discounts at hotels, cash, brand-name merchandise, or gift certificates. Earn one point for every net retail purchase dollar. The card user gets Access to special Cardmember offers from American Express to save on shopping, dining, travel, hotels, and much more. Provides free 24/7 Concierge Service.

Alaska Airlines Visa® Signature: The Intro APR for this card is 15.24% and there is no intro period. The annual fee are $75 for Visa Signature® and $45 for Preferred. But there are certain considerable benefits such as $50 round-trip companion ticket upon approval and on each anniversary as a cardholder. 5,000 Bonus Miles upon approval and 1,000 additional bonus Miles upon approval for applying online. 2,000 Anniversary Bonus Miles. The card user can redeem miles with Alaska or any of its 10 airline partners – award travel begins at just 20,000 miles. Additionally this card provides 1 mile for every net retail purchase dollar spend.

Money Return Visa® Platinum: This card offers 0% Intro Annual Percentage Rate (APR) on purchases and balance transfers for the first 6 billing cycles. The card user gets back 10% of yearly interest charges and there’s no annual fee, provides Online Banking Service and Total Security Protection.

Pet Rewards™ Visa®: This card offers 0% Intro APR and the Intro Period is Six Billing Cycles. There is no annual fee. Gives 500 bonus points after first purchase. 1 point for every dollar spend on everyday purchases and rewards begin at just 750 points. The card user can earn points toward veterinary services, pet food discount certificates, and shelter donations also earn two PetRewards Points for each dollar spend at participating veterinary clinics, pet food retailers, farm and feed stores, and neighborhood pet specialty stores.

Getting a Tax Credit for Your Kids

January 22nd, 2015 by admin

As you know, raising a family is a full time job and can put stress on your finances. Fortunately, you can claim a tax credit to help cut your IRS bill if you have kids.

Getting a Tax Credit for Your Kids

With a tax deduction, you are reducing the total amount of adjusted gross income you have. For instance, if you earned $50,000 dollars in 2005 and take a $1,000 deduction for something, you’ll have to pay tax on $49,000 dollars in earnings. Put another way, the $1,000 tax deduction will save you a hundred dollars or so in the amount you have to send to the IRS.

A tax credit is a beautiful thing. It is designed to reduce the amount of taxes you on a dollar for dollar basis. Taking our example above, you would not deduct a $1,000 tax credit from the $50,000 you earned. Instead, you would go to the tax tables and determine the amount of tax you owe on the $50,000. Let’s say the tax tables reveal you owe $9,000. You would reduce this amount by the $1,000 tax credit and pay $8,000 dollars to Uncle Same. Put another way, tax credits are tax deductions on steroids!

If you are raising children, you may be able to claim a tax credit for each one. They must be under 17 at the end of the tax year, a U.S. citizen, your child and a dependent. Adopted children fit within the tax credit as do stepchildren and certain foster children.

This tax credit, however, does have some limitation. The primary issue is something called the phase out. If you make more than a particular dollar figure, the tax credit is either reduced or eliminated depending upon your particular circumstances. The phase out start when your adjusted gross income exceeds the following amounts:

1. Married filing Jointly: $110,000

2. Married filing Separately: $55,000

3. All Other Designations: $75,000

It is important to keep in mind that this tax credit is not a profit center. If you owe the IRS $4,000, but can tax a tax credit for 5 children, you will not get $1,000 back from the IRS. Instead, you tax bill is simply canceled out.