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Added April 21, 2010 from: Beverly Blair Harzog
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 Beverly Blair Harzog
Answered By Beverly Blair Harzog:   The grace period is the amount of time between the statement date and the date the payment is due. If you pay your balance in full by the due date, you won't have to pay finance charges.

The Credit CARD Act legislation that became effective on February 22, 2010 required issuers to mail your billing statement at least 21 days before the due date, which is the date you'd begin accruing finance charges. Be sure you read the terms of your credit cards so you understand how long the grace period is for each card. Paying off your balance within the grace period can save you a bundle in interest expense.

Note, though, that some transactions aren't covered by the grace period. Generally, transactions such as balance transfers and cash advances aren't covered. This means that you'd begin to pay interest on the first day of the cash advance or transfer. The rates can be high, so read the terms of your credit card carefully to know what's covered.

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