Credit card interest rates are how lenders make their money, but that amount of money usually depends on the card holder. Interest rates have been going down in past few weeks and are likely to be seeing even more changes in the next few months, they are falling to record lows as lenders try to get into one of the few remaining areas for growth in the credit industry. Credit card interest rates are usually tied to the US Prime Rate; the interest rate set nation-wide by the Federal Reserve Board.
Interest
Interest can vary considerably from lender to lender, and the rate on a particular card may jump drastically if a consumer is late with a single payment or goes over their limit, and sometimes if the bank decides to raise its revenue. Interest is usually displayed as APR, which stands for "Annual Percentage Rate". It is law that credit card interest rates must be displayed on the product so that the consumer knows the rate they are going to be paying, thus enabling them the chance to compare offers. Interest rates, high fees, and increasing minimum payments have many consumers feeling the credit crunch of 2008. If you have been making timely payments to your account (for several months) and you don't usually max out your available credit, you can usually negotiate with the bank for a lower rate.
Online
Searching online is a great way to help find companies that have the best rates. If you do a internet search you can also find a variety of APR calculators which can help you to figure the credit card interest rate re-payment totals. If you are comparing credit cards on the internet, you should always find the web page link that contains the financial disclosure information and a most likely a chart that lists the APR along with other fees and charges that might be associated with the product. There are also options for those with a bad credit history other than a standard unsecured card such as pre-approved credit cards, but the interest on these types of products are usually a lot higher.
Notes Of Interest
Obama voted "NO" on the Dayton Amendment to the 2005 bankruptcy-bill that would freeze credit card interest rates at no higher than 30 percent.
India's APR's appear to be the lowest while Brazil has the some of the highest credit card interest rates around.
Most rates range from 10-20 percent APR, although some cards can go as high as 30 percent for consumers with a bad credit history.
Millions of consumers are fortunate enough to possess good or even excellent credit. If this describes you then you probably also enjoy the flexibility that comes with carrying a few credit cards in your wallet. Most people, however, don't know how to make the most of that flexibility to realize all of the potential of their credit card purchases.
Credit card interest rates vary greatly. Predatory credit companies offer cards that carry interest rates in excess of twenty-six percent, while quality low-interest credit cards like the American Express Blue card carry interest rates as low as %8.99. That's a three-fold difference!
That is an incredibly big difference. Now, if you are in the habit of paying off the balance of your credit card every month this has little or no impact (see Grace Period), but if you don't pay your card off completely every month you're throwing money away. Check this out: given an average balance of $1,000 dollars, over the course of a year you would pay $90 in interest with that American Express card and closer to $250 dollars with some of the higher interest cards!
You should always be aware of the interest rates that you are paying on your credit cards. You should also check periodically to see if you can find a better deal, and if you do, take it. Here are some tips to use when shopping for low interest credit cards:
* Shopping for credit cards on-line is the easiest way to get the best deal available. Credit card web sites carry many different credit card products and allow you to compare them point-for-point with the click of a mouse - and all in the privacy of your home. You can shop, apply and be accepted - all on-line.
* Throw out those credit cards that come in the US mail. They always carry interest rates higher than those that you can find on your own. Some credit card banks spam good credit risks with offers and they are uniformly worse than those you can find on-line. Check the Truth in Lending statement that comes with each offer in the mail - you'll see what I'm talking about.
* Pay attention to the Grace Period quoted by all credit card vendors as a part of their agreement with you. The grace period is the amount of time between when you purchase an item with your credit card and when the company begins to charge you interest on that purchase. They typically vary from zero to thirty days, and longer is better. If you're like many who pay their complete balances every month, you may be surprised to find that you still end up paying interest in some cases; what you're seeing is a short Grace Period in action. Avoid short grace periods.
* Don't be greedy - too many credit cards can be bad for your credit rating. Plus, too any credit cards get a little hard to keep track of. Shop for the best credit card interest rate you can find, apply for the cards and once you get them trade out your higher interest cards, closing the old accounts.
I don't enjoy knowing that I am throwing money away, and most people feel the same way. Paying too much interest on a credit card is throwing money away. If you carry credit cards that aren't tailored to your spending and payment habits, you can do a lot better - easily. You an always find a better deal.
Both Arthor Pens & Michelle Lefeaux are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Arthor Pens has sinced written about articles on various topics from Affiliate Programs, Pets and Pets. The author has been owner/operator of several finance related web sites for the past several years, including sites specializing in. Visit our website. Arthor Pens's top article generates over 90500 views. to your Favourites.
Michelle Lefeaux has sinced written about articles on various topics from Credit Card Interest Rates, Credit Cards. Michelle has been an advocate of smart for over ten years, and has been assisting consumers with financial and credit decisions for over 20 years. Michelle Lefeaux's top article generates over 1600 views. to your Favourites.