# What Is a Good APR for a Credit Card?

If you’re wondering what a good APR is for a credit card, you’re not alone. Many people struggle to understand the ins and outs of credit card interest rates. In this blog post, we’ll help you make sense of it all and give you some tips on how to keep your APR low.

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## APR Basics

The APR, or annual percentage rate, is the amount of interest you’ll pay annually on any outstanding balances on your credit card. The lower the APR, the less you’ll pay in interest. In general, APRs on credit cards range from about 12% to 30%. Some APRs are variable, which means they can fluctuate with the prime rate.

### What is APR?

The APR, or Annual Percentage Rate, is the cost of borrowing money on your credit card. It’s a way for issuers to price their cards and give you an idea of how much you’ll pay in interest if you carry a balance. The APR is the sum of the interest rate plus any additional fees charged by the issuer, such as an annual fee.

Most issuers charge a variable APR, which means that it can change over time. The APR is usually based on the prime rate, which is a benchmark set by banks. So when the prime rate goes up, your APR will likely go up as well. However, your APR won’t necessarily change every time there’s a change in the prime rate. And some issuers may offer promotional rates that are lower than the current APR.

APR can be confusing because it’s expressed as a yearly rate, but it’s actually applied to your account balance monthly. So if your APR is 15%, you’ll actually be paying 1.25% in interest each month (15% divided by 12 months).

It’s important to remember that the APR is not the same as your interest rate. Your interest rate is the cost of borrowing money on your credit card for one year, while your APR includes both the interest rate and any additional fees charged by the issuer.

### How is APR calculated?

Most credit cards have an annual percentage rate (APR) of around 15%. But what does that mean? And how is it calculated?

APR is the cost of borrowing money on your credit card, expressed as a yearly interest rate. It includes both the interest rate charged on your outstanding balance and any fees you are charged for borrowing money.

Here’s how it works: Let’s say you have a credit card with an APR of 15% and you borrow \$1,000. If you don’t pay off your balance at the end of the month, you will be charged interest on the \$1,000 at a rate of 15% per year. That comes out to an interest charge of \$150 for the year.

Now let’s say you make a payment of \$50 at the end of each month. In this case, you would only be charged interest on the remaining \$950 balance at the end of each month. At the end of 12 months, you would have paid off the entire balance and would owe no interest charges.

APR is usually calculated using a daily periodic rate, which is then multiplied by 365 to get the annual percentage rate.

### What is a good APR?

APR, or annual percentage rate, is the amount of interest you’ll pay on your credit card balance yearly. For example, if you have a \$1,200 balance on a card with a 15% APR, you would owe \$180 in interest for that year (\$1,200 x 0.15).

The lower the APR, the less you’ll pay in interest. However, keep in mind that some cards offer 0% APR promotional financing for a set period of time (usually 12 to 21 months), which can be a good option if you plan to carry a balance and want to save on interest. Just be sure to pay off your balance before the promotional period ends or you’ll be stuck with a much higher APR.

## Factors That Affect APR

APR, or annual percentage rate, is the amount of interest you pay on your credit card balance each year. This rate is determined by your credit card issuer, and it can be fixed or variable. The average APR for all credit cards is about 15%, but your APR will depend on many factors, including your credit history, the type of card you have, and the prime rate. Let’s take a look at some of the factors that affect your APR.

### Credit score

One factor that’s used to calculate your APR is your credit score. Your credit score is a number that represents your creditworthiness. The higher your score, the lower your APR is likely to be.

Other factors that can affect your APR include the type of card you have, the type of transaction you’re making, and the prime rate.

### Card issuer

There are a number of factors that can impact the APR you’re offered on a credit card, but one of the most important is the card issuer. Furnishing companies, such as Discover and American Express, have established themselves as offering lower APRs than other issuers.

This isn’t always the case, though. Some bank-issued cards, like Chase Slate and Citi Simplicity, also boastAPRs below 20%. In general, you’ll have better luck finding a low APR from a larger issuer than from a smaller one. But it pays to shop around and compare offers before you apply for a new credit card.

### Card type

There are many different types of credit cards available, each with their own unique terms and conditions. Some cards have fixed APRs, while others have variable APRs that can change over time. The type of card you have can impact the APR you’re offered.

Here are some of the most common types of credit cards and how they may affect your APR:

Secured cards: These cards require a security deposit, which is typically equal to your credit limit. Secured cards are designed for people with bad or limited credit history. Because they’re considered to be higher risk, secured cards often come with high APRs.

Unsecured cards: Unlike secured cards, unsecured cards don’t require a security deposit. Unsecured cards are available to people with good or excellent credit history. Because they’re considered to be lower risk, unsecured cards typically come with lower APRs.

0% APR introductory offers: Many credit card companies offer 0% APR intro periods as a way to entice new customers. These intro periods typically last for 12 to 18 months and can be a great way to save on interest if you plan on carrying a balance on your card. However, after the intro period ends, your APR will usually revert back to the standard rate, which could be higher than the APR on other cards.

Rewards cards: Rewards cards offer perks like cash back or points for every dollar you spend. These rewards can be redeemed for travel, merchandise, or statement credits. Rewards cards typically come with annual fees and higher APRs than other types of credit card

### Promotional rates

Promotional rates are often used to entice customers to sign up for a new credit card. These rates can be 0% APR for a set period of time, which can be helpful if you need to finance a large purchase or balance transfer. However, promotional rates typically only last for 6-18 months, after which the APR will increase to the standard rate. Be sure to read the fine print so you are aware of when the promotional rate expires.

## How to Get a Lower APR

One of the main things to look for when you are choosing a credit card is the APR. This is the Annual Percentage Rate and it is the amount of interest that you will be charged on your balance if you do not pay it off in full each month. The lower the APR, the better.

### Shop around

If you have good credit, you should be able to get a competitive APR on your credit card. But if you have excellent credit, you may be able to qualify for an even better rate.

The best way to get a lower APR is to shop around and compare offers from different issuers. You can use a tool like the CreditCards.com tool to compare offers and find the card with the lowest APR for your needs.

Once you’ve found a few cards that offer a low APR, it’s important to read the fine print and make sure you understand the terms and conditions before you apply. Some cards may have an introductory APR period, after which the rate will increase, so it’s important to know how long the introductory period lasts and what the regular APR will be once it expires.

You should also be aware of any fees that may apply, such as balance transfer fees or annual fees. These fees can offset any savings you might get from a lower APR, so it’s important to factor them into your decision.

If you’re not sure whether you can qualify for a low APR card, it’s always best to check with the issuer before you apply. They will be able to tell you what offers are available based on your credit history and other factors.

Your credit card APR is the interest rate you’re charged on your outstanding balances.

If you have good credit, you may be able to negotiate a lower APR with your issuer. To do this, call your issuer and ask to speak with a customer service representative. When you get on the phone, calmly explain that you’re considering switching cards because you’ve found a better offer elsewhere. Then, ask if there’s anything they can do to help keep you as a customer.

In some cases, the customer service representative may be able to lower your APR. If they can’t (or if they won’t), thank them for their time and end the call politely. You can always try again later or look for a new credit card with a lower APR.

### Use a balance transfer credit card

If you are carrying a balance on your credit card, you may be interested in finding a card with a lower APR. Depending on the card, you may be able to get a 0% APR for a limited time on balance transfers. This can help you save money on interest and pay down your debt more quickly. Keep in mind that balance transfer credit cards usually have a higher APR for new purchases, so it’s important to pay off your balance before the introductory period ends.

### Use a personal loan

If you have good credit, you may be able to get a personal loan at a lower APR than your credit card. You can use a personal loan for anything, including debt consolidation, and you’ll typically get a fixed interest rate and monthly payment. Just be sure to compare lenders to find the best rates.