Credit card interest rates end five-week run of increases
Keen observer of the payments and credit card industry.
The content on this page is accurate as of the posting date. Some of the offers mentioned below may no longer be available. Please review our list of best credit cards to find our current offers, or use our CardMatch tool to find cards matched to your needs.
The latest run of interest rate increases has ended.
|CreditCards.com's Weekly Rate Report|
|Avg. APR||Last week||6 months ago|
|Methodology: The national average credit card APR is comprised of 95 of the most popular credit cards in the country, including cards from dozens of leading U.S. issuers and representing every card category listed above. (Introductory, or teaser, rates are not included in the calculation.)|
The national average interest rate on new credit card offers was unchanged last week, according to the CreditCards.com Weekly Credit Card Rate Report. It's the first time in six weeks that the rate hadn't risen.
But don't mistake an unchanged national average for a lack of activity by credit card issuers. Three of the nation's largest issuers -- Citi, Chase and Discover -- made changes to their new card offers last week, with some boosting rates and some lowering them.
After all those tweaks and changes, the national average annual percentage rate (APR) on new card offers stands at 14.43 percent -- the highest since April 2010, when the rate hit a record 14.7 percent. It has not fallen since mid-May.
This week's moves
Discover was the busiest, lowering the standard purchase APR range for two offerings -- its Escape and Miles cards. The low end of each card's APR fell by one percentage point, as did the top end of the range for the Miles card. (The Escape card's top end was unchanged.) Discover did not respond to a request for comment.
Citi went the other direction, raising the lower end of the APR range on its Platinum Select MasterCard by two percentage points. The top end of the range was unchanged. A Citi official said, "We constantly evaluate pricing against the market and adjust where appropriate to ensure we can deliver value to customers in a profitable manner."
Chase's move didn't impact the national average, but it could have a real effect on consumers. The bank changed its Priority Club Visa card's interest rate from a single 13.24 percent to a range of 13.24 percent to 17.24 percent. That change wouldn't alter the CreditCards.com national average -- we calculate it using the lower end of APR ranges, not the higher. However, those who successfully apply for that card will no longer be guaranteed that lower-than-average rate.
"Our pricing reflects a multitude of factors that are relevant to our business," said Chase spokeswoman Gail Hurdis, "and we adjust it from time to time as we think it's appropriate for consumers and the company."
What it means to you
These rate changes mean a typical cardholder who borrowed $5,000 on a credit card today and consistently paid $150 per month at today's average interest rate would have to pay $6,428 to pay off the debt. That's $207 more than would have been required six months earlier. (Calculator: How long will it take to pay off your credit card balance?)
See related: Credit card lending standards keep tightening, Fed report says, Credit card reform arrives in the form of the Credit CARD Act, Calculator: How long will it take to pay off your credit card balance?, Credit card rates: interactive graphic on APR changes
- Credit inquiries fell to historic low in Q4, NY Fed says – A report by the New York Fed shows credit inquiries in the past six months fell to a historic low in the fourth quarter of 2018 ...
- Fed: Card balances rose by $1.7 billion in December – Credit card balances increased in December, according to the Federal Reserve ...
- Poll: Americans leave their personal info open to thieves – A new CreditCards.com poll finds nearly all Americans get careless with their private information in some way. The most common error: reusing the same password online ...