Best credit cards for low APR
CardRatings editors break down the top low APR cards in multiple categories.
See best cardsFrequently Asked Questions
What is the difference between low rate and 0% APR credit cards?
Low-rate credit cards offer a relatively low ongoing interest rate on purchases, balance transfers, and sometimes cash advances. The exact interest rate can vary, but it is typically lower than the average interest rate on credit cards. Zero percent APR credit cards, on the other hand, offer an introductory period during which the cardholder pays no interest on specific transactions, such as purchases or balance transfers. After the introductory period expires, a standard interest rate will apply.
Low-rate credit cards don't have a 0% APR introductory period. Instead, they offer a consistent, lower interest rate from the start. These cards are designed for individuals who may carry a balance on their credit card and want a lower interest rate over the long term. Credit cards offering 0% APR for a promotional period are often used by individuals looking to make large purchases or transfer existing balances to avoid paying interest during the introductory period.
How to lower APR on credit cards
Lowering the APR on your credit cards can save you money on interest charges. While there's no guaranteed method to lower your APR, here are some strategies you can try:
- Negotiate with your credit card issuer. Start by calling your credit card issuer and inquiring about the possibility of a lower interest rate. Highlight your good payment history, creditworthiness, and the length of time you’ve been a customer. It’s also worth mentioning any competing offers you may have received from other credit card companies.
- Improve your credit score. A higher credit score may make you eligible for lower interest rates. Focus on paying your bills on time, reducing your credit card balances, and addressing any negative items on your credit report. It’s also important to regularly check your credit report for inaccuracies and dispute and errors you may find.
- Consolidate or transfer balances. Consider consolidating multiple high-interest credit card balances into a single, lower-interest loan or credit card.
- Explore other credit card options. Research other credit card options that offer lower ongoing interest rates. Compare different cards and their terms, keeping in mind your spending habits and needs.
What credit cards have the lowest interest rate?
Credit card interest rates can vary widely, and the rate you receive often depends on your creditworthiness. Additionally, credit card companies may change their interest rates and terms over time. Typically speaking, cards requiring excellent credit are likely to offer the most favorable terms.
Why is it important to find a credit card with a lower APR?
Finding a credit card with a lower APR can be important for several reasons, as it can have a significant impact on your overall financial well-being. Some of those reasons include:
- Reduced interest costs. The primary advantage of a lower APR is that it reduces the amount of interest you'll be charged on outstanding balances. This is particularly important if you carry a balance on your credit card from month to month.
- Cost savings over time. Lowering your interest rate can result in substantial cost savings over the long term, especially if you have significant credit card debt. A lower APR means you'll pay less in interest for each month you carry a balance.
- Debt payoff. If you're working on paying down existing credit card debt, a lower APR can accelerate your debt payoff. More of your payment will go towards the principal balance rather than interest charges.
- Financial flexibly. A lower APR provides more financial flexibility by reducing the burden of interest on your budget. You'll have more disposable income to allocate toward other financial goals, such as saving or investing.
- Improved credit score. Responsible credit use, including timely payments and managing credit card debt, can positively impact your credit score. A higher credit score may make you eligible for better financial products and lower interest rates in the future.
- Avoidance of debt cycles. High-interest debt can contribute to a cycle of debt that becomes challenging to break. By securing a credit card with a lower APR, you can work towards avoiding this cycle and building a healthier financial foundation.
- Peace of mind. Knowing that you have a credit card with a lower APR can provide peace of mind, especially during uncertain financial times. It can offer a safety net without the added stress of high-interest charges.
While a lower APR is beneficial, it's also crucial to consider other factors when choosing a credit card, such as annual fees, rewards programs, and additional benefits. Finding a balance between these factors can help you choose a credit card that aligns with your financial goals and spending habits.