If you don’t understand the language, credit card offers and statements could land you deep in debt, or at least raging frustration. For detailed insight into the fine print, here’s what these commonly used credit card terms mean.

1. Average daily balance — This is the method by which most credit cards calculate your payment due. The average daily balance is determined by adding the balance for each day and then dividing that total by the number of days in a billing cycle. The average daily balance is then multiplied by a card’s monthly periodic rate, which is calculated by dividing the APR by 12. A card with an 18 percent APR would have a monthly periodic rate of 1.5 percent. If that card had an average daily balance of $500, it would incur a monthly finance charge of $7.50.

2.APR (Annual Percentage Rate) — An annual interest rate that includes fees and costs paid to acquire the loan. Lenders are required by law to disclose the APR. The rate is calculated in a standard way, taking the average compound interest rate over the life of the loan, so that borrowers can compare loans.

3. Balance transfer — The process of transferring unpaid credit card debt from one issuer to another. Card issuers sometimes offer enticing rates to encourage incoming balance transfers and balance transfer fees to discourage them from leaving.

4. Cash advance fee — A charge from the bank for using credit cards to obtain cash. This fee can be set in terms of a flat fee per transaction or a percentage of the cash advance amount. For example, the fee may be expressed as: “2%/$10”. This means that the cash advance fee will be 2 percent of the cash advance amount or $10, whichever is greater.

Banks may limit the amount that can be charged to a specific dollar amount. Depending on the bank issuing the card, the cash advance fee may be deducted directly from the cash advance at the time the money is received, or it may be posted to your bill as of the day you receive the advance. The cost of a cash advance is also higher because there is usually no grace period. The interest increases from the moment the money is withdrawn.

5. Cardholder Agreement — The written statement giving the terms and conditions of a credit card account. Cardholder agreement is required by Federal Reserve regulations. You must include the Annual Percentage Rate, the minimum monthly payment formula, the annual fee if applicable, and the cardholder’s rights in billing disputes. The issuer may make changes to the cardholder agreement, with prior written notice, at any time. The rules for imposing changes vary from state to state, but the rules that apply are those of the issuing bank’s home state, not the cardholder’s home state.

6. Finance charge — The charge for the use of a credit card, made up of interest costs and other charges.

7th floor — The lowest possible rate on a variable rate loan or line of credit, after any initial introductory rate period. For example, on a credit card with the prime rate as an index, no matter how low the prime rate falls, the rate on the line can never drop below the stated minimum rate.

8. Free period — Also called a “grace period,” a free period allows you to avoid finance charges by paying your balance in full before the due date. Knowing if a card gives you a free period is especially important if you plan to pay your bill in full each month. Without a free period, your card issuer may impose a finance charge from the date you use your card or from the date each transaction posts to your account. If your card includes a free period, the issuer must mail your bill at least 14 days before the expiration date so that you have enough time to pay.

9. Minimum payment — The minimum amount a cardholder can pay to prevent the account from going into default. Some card issuers will set a high minimum if they are unsure of the cardholder’s ability to pay. Most card issuers require a minimum payment of two percent of the outstanding balance.

10. Overlimit Fee — A fee charged for exceeding the credit limit on the card.

11. Periodic fee — The interest rate described in relation to a specified amount of time. The monthly periodic rate, for example, is the cost of credit per month; the daily periodic rate is the cost of credit per day.

12. Pre-approved — A “pre-approved” credit card offer only means that a potential customer has passed a preliminary credit check. A credit card company can turn away customers it invites with “pre-approved” spam if it doesn’t like the applicant’s credit rating.

13. Secured card — A credit card that the cardholder insures with a savings deposit to guarantee payment of the outstanding balance if the cardholder defaults. It is used by people new to credit, or people trying to rebuild their bad credit ratings.

14. Teaser Fee — Often called the introductory rate, it is the below-market interest rate offered to entice customers to change credit cards or lenders.

15. Variable interest rate — Percentage that a borrower pays for the use of money, and that rises or falls periodically based on changes in other interest rates.

I hope these terms help you a little when choosing your next credit card.