Reports have recently shown that credit card interest rates may be on the rise, which has many consumers wondering whether affordable, low interest rate cards are still available as there are also indications that many lenders are beginning to offer more credit card opportunities to those who previously found that access to credit was tight. A recent report on CNNMoney.com stated that interest rates are near record highs and, as a result, there is question as to whether these rates are here to stay or if this is only a temporary peak in rates.
There are those who feel that the CARD Act has led to these increases in interest rates due to the fact that lenders are now prevented from raising rates in many instances without fair warning or specific reasons for doing so. Obviously, these new rules have put some credit card companies in a position where they are unable to collect as many fees or earnings from interest rates, so rather than attempt to increase rates after a card has been issued, these increases are being tacked on to an initial credit card offer.
While there are no caps on credit card interest rates, there are still some offers by companies that may bring an interest rate lower than these averages, which have been around 14.72%, but advisers often caution cardholders against jumping into a credit card agreement before reading the fine print as, again, lenders are looking to establish higher rates at the present time due to the fact that they cannot increase rates later.
Also, there are some lenders who are requiring that borrowers be in a better financial position than in the past, but again these reports are mixed as there are some indications that the subprime credit card offers are becoming more available to individuals who may not be in an optimal financial position, but may still be able to afford a card. Yet, no matter what one’s credit score happens to be, careful attention needs to be paid to not only fees and upfront interest rates, but implementing careful use if a consumer acquires a credit card.
There are still options for cardholders to gain access to secured credit cards which can be used to build one’s credit score to a more positive level that could result in lower credit card interest rates on unsecured cards, but again there are a wide range of credit card opportunities that do offer different interest rates and, depending upon one’s credit score and financial position, these high rates may not be a problem as some cardholders could find themselves to be in possession of the card that offers a low, affordable rate that is a result of their positive credit score.