Low Interest Rate Credit Cards

Along with 0% introductory APR credit cards, there are “low interest rate credit cards” and low fixed rate credit cards. These low interest rate credit cards usually offer a promotional 0% introductory APR, along with a relatively low variable APR after the introductory period.

APR Isn’t All That Low

I wouldn’t say the APR on “low interest credit cards” is truly low, but low relative to rates seen on most other credit cards. The APR is typically closer to 10%, rather than the usual 20% to 30% you’ll find with most standard credit cards. Personally, I wouldn’t want to pay either, as they’re both high interest rates.

Some of these cards also offer a fixed rate for the life of a balance transfer, usually around 4.99%. While this may be a good deal, seeing that it gives you plenty of time to pay off the balance, I would recommend sticking with a 0% APR balance transfer that allows you to pay zero interest, typically for 12 billing cycles or longer.

It’s tough to find a low interest rate credit card that offers the best of all worlds, so it really depends on your particular situation. If you think you’ll be able to pay off a balance transfer in 12 months, select a credit card with the promotional 0% APR for 12 months.

Large Balances May Call for Low Interest Rate Credit Cards

If you have a large balance that will take time to pay off, it might be best to get a credit card with a low, fixed interest rate for the life of the balance.

If you don’t have a balance, but plan on carrying one month-to-month, you may want to go for a low interest credit card that starts below 10% with a good rewards structure.

Either way, it’s important to note that the majority of low interest rate credit card offers are either introductory or variable, meaning the interest rate is not fixed. The one exception is the fixed-APR on balance transfers that some credit card issuers offer. So even if you find a low interest rate credit card, it usually means very little, as it can change with slight warning.

And remember, if you’re ever late on any payments, the bank could raise your APR, or cut your fixed APR period short. So pay close attention to all your monthly liabilities, and make sure you always stay current. Never pay your bill last minute, as it might not post on time.

On to a few credit cards I’ve seen lately that offer low interest rates:

Blue from American Express offers 4.99% fixed APR on balance transfers for the life of the balance, 0% APR for the first 15 months on purchases, variable APR of 12.24% thereafter, and no annual fee. This is probably the best deal I’ve seen in the low interest rate credit card department, assuming you’ve got a large balance you wish to pay off slowly. But it doesn’t offer 0% APR on balance transfers, which to me is a major negative.

There’s also the American Express Clear credit card, which offers fixed APR of 5.99% for the life of the balance with NO balance transfer fee, and no other fees for that matter.

Citi offers 12 months introductory 0% APR and a variable APR of 11.24% thereafter, which is relatively low, with no balance transfer fee. It’s a good deal if you’ve got a balance transfer you think you can manage to pay off in 12 months.

Finally, Capital One has a few low interest credit cards starting at a super low 6.81%, but they don’t offer 0% APR on balance transfers, which somewhat kills the deal.

In conclusion, the key is to find a credit card with as many of the benefits as possible, that best suits your situation. Look around and be choosy before deciding on a credit card.