Credit card APR, or annual percentage rate, is an amount that any credit card owner pays on their credit card account in interest rates annually. This amount will tend to change depending on whether or not you pay off your balance on your credit card every month.
For instance, if you pay your bills on time, this will have an effect on your APR. Therefore, if you forget to make payments on your credit card bills, the APR will change because the bank will add penalties for late payments on top of the regular APR that is charged to you.
In the United States, every citizen has a credit history that will dictate what kind of APR is due them. Having a good credit history will allow a citizen to avail of lower rates in APR that can be as low as three percent.
However, if you have a bad credit history, interest rates can reach to as much as 30 percent. This kind of interest rate will usually let the card holder think twice about accepting the card or avoiding it altogether to reduce debt.
APR on a credit card is always a big factor in why people get credit cards or turn down pre-approved ones. If the annual interest rate is too high, they will probably turn down the card to avoid high payments in interest rates that will accumulate over the year every time that they use the card.
There are some companies and banks that will offer credit cards with either a fixed credit card APR or a variable one. Most people would prefer a fixed rate, although a variable APR has its advantages because it can go lower than the fixed rate at times.
APR that is variable, however, will change according to the performance of the company that the credit card is from. The variable APR is calculated as the prime rate plus 3 percent on top of it. This means that every day, the variable credit card APR will vary according to the economic climate.
For instance, if you pay your bills on time, this will have an effect on your APR. Therefore, if you forget to make payments on your credit card bills, the APR will change because the bank will add penalties for late payments on top of the regular APR that is charged to you.
In the United States, every citizen has a credit history that will dictate what kind of APR is due them. Having a good credit history will allow a citizen to avail of lower rates in APR that can be as low as three percent.
However, if you have a bad credit history, interest rates can reach to as much as 30 percent. This kind of interest rate will usually let the card holder think twice about accepting the card or avoiding it altogether to reduce debt.
APR on a credit card is always a big factor in why people get credit cards or turn down pre-approved ones. If the annual interest rate is too high, they will probably turn down the card to avoid high payments in interest rates that will accumulate over the year every time that they use the card.
There are some companies and banks that will offer credit cards with either a fixed credit card APR or a variable one. Most people would prefer a fixed rate, although a variable APR has its advantages because it can go lower than the fixed rate at times.
APR that is variable, however, will change according to the performance of the company that the credit card is from. The variable APR is calculated as the prime rate plus 3 percent on top of it. This means that every day, the variable credit card APR will vary according to the economic climate.
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