[wpseo_breadcrumb]Ever take a look at a credit card offer or a monthly statement and think, “I’m not sure what that means.” What’s the difference between being pre-screened and being pre-selected? Is a CVV different than a security code? It can be hard to decipher what the meaning of credit card terms are—especially when different companies use different words to say the same thing. Here are 27 definitions of common credit card terms that we think you should know.27 common credit card terms definedBetween offers, billing statements, emails, texts, and apps, there can be a ton of words used to communicate information about your credit cards. Understanding what those terms mean is key to using your credit cards right and getting the most out of them.Definitions of Credit Card Terms You May See in Marketing and Credit Card Offers Definition of a Credit Card APRA credit card annual percentage rate, or APR, is the amount of interest that you could be charged, expressed as a yearly percentage. Your APR is typically printed on an offer and your monthly statement so you can see how your interest is calculated. Most credit cards have variable APRs, which means that your APR will likely change over time.APR for Cash AdvancesAn APR for a cash advance is an annual percentage rate that’s calculated specifically for cash advances. Cash advance APRs are typically higher than a regular APR, and they’re only charged to the amount of the cash advance that you take out on your credit card.Introductory APRAn introductory APR is an annual percentage rate on a credit card that’s often offered to attract new customers. Many introductory APRs are low or start at 0%, but only apply to purchases for a set period of time.Penalty APRCredit card companies may charge a penalty APR if certain use restrictions are broken. Some of the reasons a credit card company may charge a penalty APR include late or missed payments, going over a credit limit, or returned payments. Penalty APRs are typically higher than regular APRs and are usually applied for a set period of time.Balance TransferA balance transfer means that you move a credit card balance from one to another, typically at a lower APR. Many credit card offers have special APRs for balance transfers, which could help you save money on interest.Pre-screenedBeing pre-screened refers to a credit card offer that targets consumers based on their borrowing history and other factors, and appears when a credit card offer uses language like ‘pre-approved’ or ‘pre-selected.’ On many credit card offers, you will see the word ‘Pre-screened’ next to an Opt-Out Notice, which explains how you can request to opt out of future offers through the credit bureaus if you are not interested.What does being Pre-Qualified, Pre-Selected or Pre-Approved on a credit card offer mean?The terms pre-qualified, pre-selected, and pre-approved are used to refer to certain customers who receive credit offerings. Being pre-qualified, pre-selected, or pre-approved doesn’t mean you have been approved for an offer, but it means that a financial institution thinks you might meet certain eligibility criteria to qualify for their credit offering.Prime RateThe Prime Rate is used by most major US banks to calculate variable credit card rates. The Prime Rate can change, usually because of major economic factors. This means that if the Prime Rate changes, your variable APR will likely follow suit. The Prime Rate that most US banks use is published by the Wall Street Journal each week.Credit LimitYour credit limit is the maximum amount of credit that your credit card will allow you to charge. Credit limits are set based on many factors, including information in your credit report. They can be increased if you demonstrate good behaviors using your credit card (such as paying off your balance each month).Definitions of Credit Card FeesForeign or International Exchange FeesA foreign transaction fee is a charge usually between 1 – 3% of purchases that you make outside the US. Many travel cards will not charge foreign transaction fees, but it’s important to read your card terms before crossing the border with any credit card.Returned PaymentA returned payment fee may be applied to a credit card account if a payment you make cannot be completed. Returned payment fees are usually applied for insufficient funds, which means there isn’t enough money in your bank account to cover the payment you’re making.Annual FeeFor many credit cards, an annual fee may be charged once a year to your account. Not all cards come with annual fees, but the ones that do often have other rewards and benefits that can help offset an annual fee.Balance Transfer FeeWhile balance transfer offers may be enticing, they often come with balance transfer fees, which can be charged on any amount you transfer from another credit card. Most balance transfer fees are between 1-10% of the amount you transfer, or a flat fee that’s charged on your account.Late FeeA late fee is a charge added to a credit card account if you do not make the minimum monthly payment by your due date.Over-limit FeeAn over-limit fee could be charged if you go over your credit limit on a purchase. Recent laws require credit card companies to get your permission to charge this fee, and they are not as common as they used to be. Definitions of Terms You May See on Your Credit Card or Monthly Billing StatementWhat is a CVV number or security code?The CVV number (also called a security code, verification code and CSC) is a three or four-digit number on your credit card used as an extra layer of security. While credit card information like your card number and expiration date are usually stored by sellers when you purchase something, a CVV code cannot be stored, which helps to prevent fraud and identity theft.Minimum Monthly PaymentYour minimum monthly payment is the smallest amount you could pay on your credit card by your due date without going past due. While just paying the minimum monthly payment is a good way to stay up-to-date on your credit card, it’s typically best practice to pay more than your minimum each month.Authorized UserHaving an authorized user on a credit card means allowing someone else to use the card other than the account holder. Many spouses, children of cardholders, and employees of a business are often authorized users on a credit card account.Cash AdvancesWhen you take out a cash advance, you take money out of your credit card, usually through an ATM. A cash advance often has fees and a higher APR on the amount you borrow. There is usually a limit of how much money you can withdrawal in a cash advance, even if your credit line is larger than that limit.Interest ChargeAn interest charge is the total amount of interest that has accrued on your balance in a billing cycle. You likely will not be charged interest if you pay your balance down before the end of your billing cycle.Billing CycleThe length of time between one credit card billing to the next is called a billing cycle. A typical billing cycle lasts about a month, but varies depending on your card carrier and the type of card you have.BalanceYour balance is the amount of credit you’ve used on your credit line. A credit card balance is the total amount of money you owe back on your credit card and can include your purchases, interest charges, and any fees.