Do you want to know what a good APR for a good credit card is? As we all know, APR, also known as Annual Percentage Rate, is the amount charged on your card balance. An APR helps you determine the amount of interest that the person issuing the card can charge on the balance.
And that is if you carry a balance that is beyond your credit card grace period. You can compare it with the average credit card APR. If you are looking at one of the best credit cards that do come with rewards, perks, and bonuses, the credit card with the national average can be a good option.
The best thing that can be good for your credit card is when you avoid credit cards that have APRs that are above the national average. You can end up paying a lot of money in interest if you carry a balance on these cards.
They provide an introductory period during which they do not charge you any interest on any purchases made with 0% APR credit cards. Understanding what a good APR all about helps you choose the credit card that will offer you the best APR package.
What is a Good APR for a Credit Card?
There are various types of credit card APR, but the one most people are really interested in is the purchase APR. The purchase APR is the interest rate you pay on a purchase you make. It can be very easy to say that you will search for credit cards that offer you APRs at or below the national average, and good purchase APR that does depend on your credit score.
Interest rates will probably be higher for those with below-average credit scores than for those with outstanding or exceptional credit. As a result, a good interest rate on a credit card for someone with mediocre credit differs from a good interest rate for someone with excellent credit.
You might want to work on raising your credit score first if you want the lowest credit card APR available. Your credit will go from “subprime” to “prime” whenever your FICO Score surpasses 670. You will then be qualified for prime interest rates. You’ll be more likely to get favorable credit card APR offers from lenders as your creditworthiness advances.
How to Compare Credit Card APRs
Check the APR range of each credit card when comparing them. For instance, consider these two cards if you are searching for one of the best reward credit cards:
- American Express’s Blue Cash Preferred Card has a variable APR of 14.74 to 24.74 percent.
- The Chase Sapphire Preferred® Card has an APR ranging from 16.24% to 23.24%.APR
The lowest APR offered by the Chase Sapphire Preferred is approximately two percentage points higher than the lowest APR offered by the Blue Cash Preferred, which is close to the national average APR of 16 percent. The credit card’s introductory APR on purchases and/or balance transfers is another important thing to look into.
For example, the Blue Cash Preferred Card has a variable intro APR of 14.74 percent to 24.74 percent on purchases for the first 12 months, but not on balance transfers. On the other hand, there are no introductory 0% APR deals available for the Chase Sapphire Preferred.
It really is important to be aware of any APR penalties that could be charged if you fail to make a credit card payment. The Sapphire Preferred and Blue Cash Preferred both have a variable penalty APR of 29.99 percent.
How to Qualify for a Credit Card With a Good APR
Developing solid credit practices is the best approach to receiving a low APR. You can take the following steps right away to raise your score:
- Pay off all of your balance on time. Make sure your payment history is good because it accounts for 35% of your credit score.
- Don’t use all the credit on your cards. Your credit utilization ratio will increase if you keep your balances low.
- Pay off as many of your unpaid balances as you can. Strive to pay off your debt.
When your credit score improves, look for low-interest credit cards. If your credit score is high, it increases your chances of getting a better APR. The best way to completely avoid interest is to pay off your balance each month.
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