Low Interest Credit Card Offers

Shopping around to find low interest credit cards with the best rates and features can be well worth the effort. The interest rate can have a significant impact on your ability to pay off you debt in a timely manner.

Understanding interest rates

All credit card offers will always include the annual percentage rate (APR) that tells you how much annual interest you are expected to pay on the amount borrowed. If you carry an average monthly balance of $2,000 on a credit card with an APR of 15% you end up paying an extra $300 each year on your original loan. Compare that APR to a low interest credit card offer with an APR of 8% where you will only pay $160 in interest each year.

There is no need to pay the credit card company an additional $140 each year when you could use that money to pay down your debt.

Introductory rate

Most credit card offers include a 0% introductory rate where you will pay no interest for the first 6 to 15 months. This offer may only apply to purchases, but often it includes balance transfers as well. You can use these offers to your benefit, because your entire payment can be applied towards your principle, helping you bring down your credit card balances faster. Choose a card that continues to offer a low ongoing interest rate after the introductory rate expires or your savings from the 0% credit card offer can quickly disappear.

Variable or fixed rate

You have the option of a low fixed rate credit card that usually does not change. The credit card company may have included the right to change to rate in their terms and conditions, but are required to give you a 15 days notice.

A variable rate credit card changes frequently as it is tied to the prime lending rate. Every time the Federal Reserve changes their rate that means your credit card interest rate will also change. There are many economic factors included in the decision by the Federal Reserve and you can never be sure which way the interest rate will move.