Low Interest Credit Card Rates And Options For Consumers–Cardholders Cautioned When Choosing A New Card

While there are reports that more financial institutions are offering credit cards to various consumers, there are also indications that credit card interest rates have been on the rise and will likely remain high for new cardholders due to constraints applied against financial institutions who, in years past, were felt to take advantage of cardholders through practices like sudden interest rate increases. However, consumers are still on the lookout for low interest credit cards and, according to Bankrate.com, low interest credit card rates are averaging around 10.85%.

The rates on low interest credit cards will, obviously, vary depending on a card holder’s financial situation or introductory offers, but many cardholders are seeing rates on the low end between 10% and 12%, for these low interest cards.  Yet advisers have been cautioning cardholders when they are looking for a new credit card as these rates may only be for an introductory period or come with a high amount of fees.

Many credit card offers that advertise these low interest rates, which may be lower than the national average, do so for only a set period of time and, also, require that the cardholder have an excellent credit score. While there are many cardholders who may be in a position where they can acquire these low introductory rates and do have a credit score to obtain a particular low interest card, advisers point out that looking at the fine print of these cards is vital so that consumers are not left holding a card whose interest rate will skyrocket after the end of the introductory period or who may be paying fees in the amount that will offset benefits from this low rate.

Cardholders, in some cases, have used these low interest credit card opportunities or even balance transfer cards that may offer a 0% introductory rate as a way to either purchase expensive items or consolidate credit card debts in the hopes of erasing the amount they owe while under a low interest rate. However, there are some cardholders who have been unable to budget in a way that has allowed them to erase the debt acquired on one of these low interest rate cards and, when their interest rate increases, they may be stuck with higher overall costs.

There are low interest rates available on credit cards for many borrowers in a good credit position and, again, certain types of cards advertising an introductory rate that is quite low can be helpful for cardholders as well.  However, consumers must make sure they keep track of interest rate increases and the outstanding principal balance they have on these cards as not properly planning for interest rate hikes or the expiration of an introductory rate could lead to financial trouble down the road and cause more financial strain on a cardholder if they are left paying debt associated with a high interest rate on their card.