Rate this post To apply for a credit card you need to consider a series of variables such as annuity and the discount programs that plastic entails in order to get the most out of our financial decisions. Among the important points that you must take into account to choose your card is the Total Annual Cost. If you still don’t know what CAT is, here we tell you.


What is the CAT?

credit loan

The CAT or, the Total Annual Cost, is a guide whose purpose is to help you calculate the total cost of financing your credits. For its calculation, the following are taken into account:

  • Interest rate
  • Account opening commissions
  • Annuity of your credit card

In case you did not know, it is a requirement of the law that the bank gives you the CAT information about your credit line. No one can charge you anything without being prevented from the beginning.


How is the CAT of credit cards calculated?

credit cards calculated?

You must use your numerical skills to get this data. Due to the obvious difficulty, the Bank of Mexico made an instruction explaining how to calculate the amount of the CAT with hair and signals.

In addition, you have a calculator exclusively for this process and you can find it here

Now, because of how cumbersome that can be, financial institutions can give you the calculation of your CAT in a personalized way.

In the case of exclusive credits, such as an automotive, mortgage or personal loans, you can use the calculator above, which is based on publications on the subject by Bansimo.


What CAT suits me?

What CAT suits me?

You must analyze and compare all the credit cards you can to make the decision that suits you. There can be a difference of up to 60 percentage points between 11 credit cards, nothing more and nothing less.

You should know that classic credit cards have the highest interest rates. There are also some cards on which you do not have to pay annuity.

On the other hand, to know which CAT suits you, you must know yourself as a buyer and identify what your requirements are. If you are looking to finance yourself with the TDC, you pay only the monthly minimum a very low CAT is useful. On the other hand, if you pay the balance you owe to the bank every month, worry about the annuity. If you can, find a way to avoid it.


Importance of CAT

importance of credit

The importance of the Total Annual Cost is that you will know for sure how much your credit is costing. In this way you can step on land when acquiring certain cards and raise awareness about the corresponding payments.

In conclusion…

Remember that debts with banks are not a good sign when choosing loans that help you finance projects. Whether you want to buy a house, a car, and all kinds of goods, it is important to maintain good relations with the banking entities that give you your trust. It is the only way to get what you want quickly!