lowest APR credit card

APR Credit Card Basics

Annual Percentage Rate, or APR, is a measure of how much interest will be on an annual basis without taking into account compound interest. Annual Percentage Yield, or APY, is the same interest rate measure, but accounts for compound interest - a better measure of how much you will actually pay in interest. Banks and credit card issuers often express credit card interest rates in APR, in order to better hide just how much interest would cost.

Unfortunately, the true amount you will pay a credit card company is often greater than just a simple interest charge on your purchases, particularly if you do not pay off your balance in full each month because you will be charged interest on any interest charges that are not paid in the preceding month, and any penalties and fees will be in addition to the annual interest calculation.

Lowest APR Credit Card Tips

It is absolutely vital for every individual to pay off their balances each and every month Keep in mind that all penalties and fees will be additionally summed up with your annual interest charges.

Lower rates are generally offered to customers who are reliable in their payments and likely to have lower balances then other cardholders. Higher risk cardholders generally get higher APRs; the companies figure they need to get as much interest out of the cardholder as quickly as possible as higher balance users who don't pay in full tend to be at greater risk for defaulting on their bills.