Low Interest Credit Cards

Fixed low interest rate credit cards are basically extinct. And there’s a fairly simple reason for that. Credit card companies lost the ability to change interest rates whenever they want when the CARD Act took effect in February 2010. In fact, they can only raise rates on existing consumer-card balances when the accountholder becomes 60+ days delinquent. The law does not cover small business credit cards.

As a result, credit card companies now use variable interest rates, which change based on a benchmark such as the Prime Rate, to make sure their offers keep pace with the broader economic climate.

Of course, introductory interest rates are an obvious exception to this rule, since they have a set expiration date.

Hi! Yes! It is definitely worth calling and asking them. You may need to make more than one call until you get a person who has the authority to make that change, but it can't hurt to call and ask. I'd do a bit of research first to see what the interest ranges are that the credit card company operates in so that you know where you might fall. You could also send an email or letter to ask.

You also might want to see if there is a format or form provided online by your credit card company to request a lowered interest rate – that site will provide specific information to help you succeed in your request. 

I feel as if it never hurts to ask for discounts and good deals. Many of us shy about doing this - I often am - but if you can get your courage up and try, you may be successful. Good luck to you!

You can consider a low rate credit card to be an offer with a regular APR below the market average for your credit standing. Here are the current averages for each credit tier, according to WalletHub’s latest Credit Card Landscape Report:

1. Excellent Credit: 14.19%
2. Good Credit: 19.88%
3. Fair Credit: 22.41%
4. Bad Credit (Secured): 19.17%
5. All Credit Card Offers: 19.05%

With that being said, credit card rates are never all that low compared to mortgage and auto loan rates. Except when a 0% intro rate is available, that is.

Interest rates vary by card, and no issuer has a reputation for offering low rates across the board. So you should focus on finding the best deal, regardless of issuer.

After all, the biggest differences between credit card companies are in terms of customer service and product features. And while customer service is important, it should only be used as a tiebreaker between cards with equally attractive terms.

With that being said, here’s how the largest credit card issuers ranked in WalletHub’s latest Customer Satisfaction Report:

1. Discover
2. American Express
3. Capital One
4. Chase
5. Bank of America
6. Wells Fargo
7. Citi

When asking for a lower APR on your credit card, persistence is key. Your request may not be granted after the first call. There’s no guarantee, but it certainly never hurts to call back later, and to ask to speak with a supervisor. However, you will need a legitimate reason in order to be successful. Before calling your card’s customer service number to make your request, there are certain steps you can take to maximize your chances of approval.

First of all, make sure that your payment history with your credit card company has been consistent for at least six months. This way, you can point to your history of being a good customer when speaking to the representative. Make sure you check your credit, as well – you can do that for free by signing up for a WalletHub account.

If you find that it is less than optimal and did not improve much since you opened your account, try to enhance your credit score before asking for a lower APR. An increase in your credit score will signal to your lender that you are more likely to repay what you owe, so they may be more willing to meet your requests.

Lastly, do your homework. Know your current credit card terms, and research and compare credit card terms and rates from numerous companies. This will give you more bargaining power when you make the call. If you do not succeed in lowering your APR, you could consider applying for a balance transfer card. A credit card with a 0 percent introductory APR offer for balance transfers is a great alternative to saving money on your debt repayment.

Hope this helps!

The importance of a low interest rate depends on your payment habits. For example, if you always pay your bill in full, your credit card interest rate simply doesn’t matter. And getting a low interest credit would likely force you to sacrifice a lot of rewards value. Still, some people who always pay in full wind think they need such a card in case they forget to pay on time one month. But if you have a pristine payment record, credit card companies will almost always refund any finance charges associated with a single slip-up. So this is a moot point.

Low interest rate credit cards can help people who consistently carry a balance from month to month or have a big-ticket purchase coming up. But would be even better since your full monthly payment will go toward the principal balance, instead of some of it being wasted on finance charges. That said, a low interest card is truly important if you occasionally revolve a balance. Your credit card company won’t give you the benefit of the doubt more than once, and a 0% credit card will not provide the long-term solution that you need.

Credit card interest rates can be as low as 0%, but only for a limited time. On the other hand, interest rates can pretty much go as high as consumers are willing to pay. That’s largely because there is no national usury law and most credit card companies operate under charters that allow them to be federally regulated.

The highest interest rate among current credit card offers is 36% (First Premier), according to WalletHub’s database of 1,000+ cards. But we’ve seen rates as high as 49.9% in the past. And if you become at least 60 days delinquent, a penalty interest rate – 26.16%, on average – will take effect. That would certainly limit the savings available from even the best low interest credit cards.

Finally, it’s also important to note that usury laws do exist at the state level. So if you are getting a credit card from a local bank, there might be an interest rate ceiling.

I chose my current credit card, the Capital One Quicksilver because even after the initial period, the APR only jumps to a reasonable range. I sometimes don't pay off the entire balance and the APR really makes a difference if this happens regularly. The other features of the cards are similar to other cards. Fees and customer service is comparable to cards from major banks. I would really like it if the APR would be lowered as a reward for not carrying a balance over a long period of time.

There aren’t any no interest credit cards for 24 months right now. The closest you’ll find is no interest for 21 months on balance transfers from Citi Diamond Preferred, which charges a 5% balance transfer fee. The longest you can get no interest on purchases from a credit card is 20 months, with the U.S. Bank Visa Platinum card. Plus, there are several credit cards with no interest for 18 months, either on purchases, balance transfers or both.

Some store cards may offer no interest for 24 months or longer. But that’s deferred interest, not true 0% interest. With deferred interest, if you don’t pay off your entire balance by the end of the promotional period, you owe all the interest you would have built up over those months at the card’s regular APR. If you do pay in full by the time the 0% period ends, you don’t owe the interest.

Here are the best alternatives to no interest credit cards for 24 months:

• No interest for 21 months on balance transfers: Citi Diamond Preferred. 5% balance transfer fee. No interest for 12 months on purchases. No annual fee. Good credit needed.
• No interest for 20 months on purchases and balance transfers: U.S. Bank Visa Platinum. 3% balance transfer fee. No annual fee. Excellent credit needed.
• No interest for 18 months on purchases and balance transfers: Citi Simplicity. 5% balance transfer fee. No annual fee. Good credit needed.
• No interest for 18 months on purchases and balance transfers: HSBC Gold Mastercard. 4% balance transfer fee. No annual fee. Good credit needed.

• No interest for 18 months on purchases and balance transfers: Santander Bank Sphere Credit Card. 4% balance transfer fee. No annual fee. Excellent credit needed.
• No interest for 15 months on purchases and balance transfers: Chase Freedom Unlimited. 5% balance transfer fee. No annual fee. Excellent credit needed.
• No interest for 15 months on purchases and balance transfers: Amex EveryDay. No balance transfer fee if transfer made in the first 60 days. No annual fee. Good credit needed.
• No interest for 15 months on purchases and balance transfers: BankAmericard for Students. No balance transfer fee if transfer made in the first 60 days. No annual fee. For limited/fair credit.

So there are a number of good alternatives to no interest credit cards for 24 months. The only catch is that you’ll need to have good or excellent credit to get them, with the exception of BankAmericard for Students.

The Chase Freedom APR is 0% for 15 months on purchases and 0% for 15 months on balance transfers, with a regular APR of 16.74% - 25.49% (V) after that. Chase Freedom’s ongoing APR is a range because different people get different rates. It depends on how “creditworthy” Chase thinks you are. The “(V)” at the end stands for “variable” and tells you the APR can change based on the economy. Chase Freedom’s APR range has risen in recent years due to changes in the Federal Reserve’s target interest rate.

Chase Freedom also has more than just purchase and balance transfer APRs. The others are worth investigating, too.

2019 Chase Freedom APRs:

• Intro Purchase APR: 0% for 15 months
• Intro Balance Transfer APR: 0% for 15 months
• Regular APR: 16.74% - 25.49% (V), based on creditworthiness (purchases and transfers)
• Cash Advance APR: 27.24% (V), plus a 5% ($10 min.) fee
• Maximum Penalty APR: 29.99%

Chase can increase your Freedom card’s APR to the penalty rate if you don’t pay your bill on time. It’ll apply to purchases made after the change, unless you’re 60 days delinquent, in which case it applies to your existing balance as well. Chase is required to give you 45 days’ notice before raising your APR.

The Chase Freedom APR is the same as that of its companion card, Chase Freedom Unlimited, which offers 1.5% cash back on all purchases rather than bonus categories.