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Quite A Bit Of Tips To Assist Consumers With Understanding Credit Card Interest Rates


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When I say that many Americans use charge card accounts, I don’t get any surprised reactions. The truth is, everyone knows it! As a matter of fact, most people of age to use charge cards not only have charge cards but use them all the time. The unfortunate side of this is that several people simply don’t understand the APRs that they are being charged on their charge card accounts. When I tell people that credit card accounts have more than 1 annual percentage rate, I usually get a pretty surprised reaction. With that said, here is a list of the APRs people may find on credit card accounts and the balances the interest rates will be charged to:

Standard APRs: The first and most widely recognized credit card annual percentage rate is called the standard interest rate. The standard interest rate on a credit card is the annual percentage rate that will be charged to balances accumulated through standard purchases. Purchases like gas stations, grocery stores and restaurants will all accumulate balances that will be charged the standard charge card account APR. However, cash transactions like wire money transfers or cash back will be charged a different annual percentage rate.

Promotional annual percentage rates: The next type of charge card interest rate that Americans will come across is called the promotional APR. Promotional annual percentage rates are short term APRs found on credit card accounts that are used as a way to attract interest to a specific charge card product. Promotional annual percentage rates will generally be around 0% and will generally last anywhere from 6 to 18 months! Once the promotional interest rate expires, all balances will be charged their specific interest rate.

Cash advance APRs: Another type of annual percentage rate that people will find on charge card accounts is called the cash advance interest rate. Cash advance charge card account interest rates are the annual percentage rates that will be charged to any balances accumulated through cash transactions. Transactions like cash back at a grocery store, ATM withdraws and wire money transfers all count as cash transactions!

Default interest rates: The next type of charge card account APR that Americans will come across is called the default interest rate. The default annual percentage rate is the APR that people don’t want to ever find themselves paying. This is because the default annual percentage rate on a credit card account is the highest interest rate that people will pay on their credit card accounts and, for good reason. The only way Americans will find themselves paying a default APR on a credit card is if they do something wrong like pay late, miss a payment or spend more than the charge card account spending limit.

I hope this article has answered any questions people may have had regarding credit card account interest rates. For more information on this topic, please feel free to visit JEMCreditCards.com!

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