A Good APR for Credit Card

by J B

We all know that People have Loans, Mortgages, and Credit cards that come with an interest rate which they need to pay by the time of payment. Those Interest rates are known as APR i.e. Annual Percentage rate. In the Case of Credit Card, These Interest Rates are charged by the Banks when People carry the balance for extra time from repayment time.

Let’s look at what Credit card APR means and what is a good APR for Credit Card.

What is APR?

Suppose you need money and you take it from your Credit Card which works like a loan. Later you get the time to repay it. If you return the full loan by the time then you don’t need to pay any interest with the principal amount but if not, then it charges you some interest of let’s say 10% on the remaining amount for 1 year. If you don’t repay those full amounts even by the year then it charges you higher interest of let’s say 20% next year onwards.

The Credit card APR is the interest rate charged on your unpaid bills in your Loan. Fundamentally; it’s how much they intend to profit from making you a debt slave.

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Credit Card organizations overemphasize how low their APR is, because it makes you believe you’re getting an incredible deal, and removes your concentration from how deep into debt you’re going in. It makes you more alright with paying them to compromise your future independence from the debt race.

What Is a Good APR?

The lower the APR, the better for your credit card record. So, to maintain a Good APR you need to do your payments on time. Sometimes when forget to pay a bill or run out of money to do a payment then it will affect your APR. It will incur the interest fee on the amount and will increase your APR. Generally, Credit Cards are very high interest as compared to any other means of Loan or borrowing and so, we advise you to never spend the money from your credit card more than you can payback. It will always be beneficial for you. For the good financial record. Whenever you use the money from your credit cards you must pay it on time because it will also help you on building good credit and financial score or earn rewards

Consider a 0% introductory APR credit card if you anticipate making a major purchase and wanting to pay off the bill in a brief period.

Cards with 0% promotional rates provide you more time to pay off your bills without incurring interest costs. 

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Remember that once the promotional period is up, the APR will revert to a variable rate dependent on reputation.

How Your APR Is Determined?

The APR on your Credit card is determined on the following basis-

  • Application credit score
  • Prime rate
  • Financial records
  • Payment History
  • Credit Report
  • Debt-to-Income Ratio (DTI)

Major Banks checks the Prime rate to set the rate on Credit Cards for loan purpose. They analyze the risk of default in payments and gain profit on unpaid bills as an Interest.


Remember that the credit card APR is most essential if, you intend to carry a balance on your credit card from monthly installments.

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Paying off your entire balance every month helps you to avoid interest payment, which is a good method to develop good APR, notably unless you are unable to meet the criteria for the lowest rates.

To ensure that you can clear off your balance every month, keep in mind you’re not spending more than you can afford.

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