The Best Low Interest Rate Credit Cards
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The only thing more challenging than managing credit card debt is getting out of it. To accomplish this important goal you need a sound budget, plenty of discipline, and a credit card with the lowest possible interest rate. (See also: The Best 0% Balance Transfer Cards)
How to Find the Lowest Interest Rates
Every bank is legally required to clearly disclose each card's Annual Percentage Rate, or APR. This is the rate you will see in the black and white box when you click on the "terms and conditions" link. While you might think these disclosures make choosing the lowest APR an easy task, it is not that simple. Most banks will disclose a range of possible rates, with each applicant being offered a particular APR according to his or her credit rating. Therefore, the lowest rates available will be granted only to those applicants with the highest credit scores, with all other cardholders receiving higher rates.
Another important aspect of a credit card interest rate is that nearly all of them will have a variable rate. The good news is that the CARD Act of 2009 prevents banks from arbitrarily raising their rates on cardholders in good standing. What you will find is that nearly every card on the market will offer a variable APR that is based on the Prime Rate. This rate, determined in part by the Federal Government, has stood at a record low of 3.25% since December of 2008. Nevertheless, the variable interest rates quoted by the credit card issuers will rise when the Prime Rate does. For example, if the Prime were to rise to 8.25%, as it did in June of 2006, cardholders would see their interest rate rise by 5% from the current rates.
Finally, the best interest rates offered for a particular card can vary based on the link you use to apply for it. I have even seen different rates for the same card depending on which browser I used!
The Five Lowest APR Cards on the Market
These cards currently have the lowest interest rates.
BankAmericard® Credit Card
The is a no-frills card does not offer any rewards, but it can be a worthwhile tradeoff for people who want a low-interest card in case they have to carry a balance from time to time. There is no annual fee. See terms for APR.
Capital One® VentureOne® Rewards Credit Card
The offers a 0% intro APR on purchases for 12 months; after that, a variable APR of 13.74%-23.74% applies. Besides a great intro purchase rate, you'll also get unlimited 1.25x miles for every dollar you spend on purchases and unlimited 10x miles on hotels when you pay with your VentureOne card at hotels.com/Venture. You can redeem your miles for travel purchases, statement credit, gift cards, and more. And if you spend $1,000 on purchases within 3 months from account opening you'll earn a one-time 20,000 miles bonus — that's equal to $200 in travel. There is no annual fee.
Citi Simplicity® Card - No Late Fees Ever
The from our partner Citi, offers 0% intro APR on purchases and balances for a whopping 18 months! After the intro period, the variable APR will be 15.74%-25.74%*. While there is a balance transfer fee of $5 or 5% of the amount of each transfer (whichever is greater), there are no late fees, no penalty APR, and no annual fee. It doesn't get simpler than that.
Capital One® Quicksilver® Card - 0% Intro APR for 15 Months
The has 0% intro APR on purchases and balance transfers for 15 months (a 3% fee applies to each balance transferred within the first 15 months). After the intro period ends, a variable APR of 14.74%-24.74% kicks in. Besides low interest rates, this card also offers simple rewards: earn unlimited 1.5% cash back on every purchase, every day. Plus, get a one-time $150 cash bonus after you spend $500 on purchases within 3 months from account opening.
Bank of America® Cash Rewards Credit Card
The offers 3% cash back for gas, and you earn 2% at grocery stores and wholesale clubs (for the first $2,500 in combined grocery/wholesale club/gas purchases each quarter). There is no annual fee. See terms for APR.
Although the best way to use a credit card is to avoid paying interest, most Americans are unable live up to this ideal. If you do have to carry a balance, your primary goal should be finding a card with the lowest interest rate. Doing so will help you to minimize the amount of interest that you owe, making it easier to pay off your credit card debt as soon as possible.
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