. The difference in just a few percentage points can make a significant difference if you are carrying a balance from month to month consistently, or if you just make a large purchase on the card.
To mitigate the interest charged on your credit card, it could be smart to search for a low-interest rate credit card offer. Credit cards with the lowest interest rates, or rates below the national average, usually have stricter requirements when it comes to qualifying for the card. For borrowers with good credit, there are many different offers currently available competitive interest rates.
There are several advantages to being a cardholder of a low-interest credit card, if you are searching for your first low-interest rate offer, there are a few things you should keep in mind.
The most obvious thing you will want to consider is the interest rate offered, be careful to determine how long the interest rate will stay at that offered rate. Many cards offer introductory rates, most of the time these introductory offers for new customers have lower interest rates. After that entry period, the interest rate may increase.
Also, keep in mind any fees associated with the card outside of interest payments. There are several cards available with little or no fees, still many cards have fees that could add up quickly. If the fees you are charged are excessive, it could offset any savings you are benefiting from the lower interest rate credit card.
Some of the most common fees include balance transfer fees, annual fees, or maintenance fees. Before applying for any new credit card, be sure to carefully research the financial consequences it will have.
Additionally, keep in mind any additional bonuses you could get, such as fuel rewards or cash back on purchases. If you can save a few percent on purchases made on the card, you can potentially benefit more from the card. The benefit would be offset if you are charged interest on the purchases, so you should not purchase just for bonuses.
A low-interest rate credit card can potentially save you money if you are carrying a balance on a card with a high-interest rate or you make need to make a large purchase on a credit card. If you have a low interest-rate card, you always have a card available if you need to carry a balance from month to month.
With the benefit available from a low-interest rate credit card, you still have to make sure you find the best offer for yourself. The amount of spending you average on a monthly basis, along with the amount and frequency you carry a balance from month to month will affect what offer suits you best.