Credit Cards and APRs
You probably see a lot of credit card offers on a daily basis
whether it's on television, the internet, a magazine or in the
mail. In the advertisement, you probably see or hear APR
mentioned several times in the form of Introductory APR,
Standard APR, Cash Advance APR, Balance Transfer APR and Default
APR. The difference between these APRs might be confusing at
first but they are pretty simple to understand.
Introductory APR refers to the initial interest rate you
receive for purchases on the credit card when you first get it.
This Introductory APR is usually really low (around 0%) and
lasts between 6 and 12 months.
Standard APR is the interest rate the credit card goes up to
after the Introductory APR period is over.
Cash Advance APR is the interest rate you receive for cash
advances.
Balance Transfer APR is the interest rate you receive for any
credit card balances you transfer over to your new credit card.
As a side note, if you have a high interest rate credit card and
the new credit
card company offers the Introductory APR for balance
transfers, transfer your balance to the new credit card if you
can pay the balance off within the Introductory APR period.
Default APR is the interest rate your card goes up to if you
are late on payments or go over your credit limit.