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Rate survey: Average card APR remains at record high of 17.64 percent

Summary

March 6, 2019: The average credit card APR held steady Wednesday after jumping to an all-time high the previous week.

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The average credit card APR held steady Wednesday after jumping to an all-time high the previous week. The national average APR for new card offers remained at 17.64 percent, which is the highest weekly average CreditCards.com has recorded in more than a decade.

Every week, CreditCards.com evaluates the APRs, annual fees and promotional terms of 100 U.S. credit cards. None of the cards included in the weekly rate report advertised new rates this week. But several cards tweaked their annual fees and promotional offers.

See related: Historic credit card interest rates chart

Two cards revise their annual fees

Bank of America dropped the annual fee it charged for its secured credit card, making it one of the few secured cards available to consumers who don’t want to pay an annual fee. Previously, cardholders had to pay an annual fee of $39.

Cardholders who are building up their credit scores now have a number of no-annual fee secured cards to choose from. For example, the Citi Secured Mastercard, the Discover it® Secured card and the Capital One Secured Mastercard also waive annual fees.

Most secured cards, by contrast, typically charge fees ranging anywhere from $25 to $49 or more.

The subprime lender First Premier also recently tweaked a card’s annual fee. It increased the annual fee for the First Premier Bank credit card from $75 for the first year to $100.

One of the few unsecured cards available for consumers with bad credit, the First Premier card charges some of the highest fees in the industry. In addition to charging new cardholders an annual fee, it also charges new cardholders a one-time $95 program fee and a $6.25 monthly fee after the first year.

The First Premier card’s annual fee drops down to $45 in the card’s second year. However, cardholders still wind up paying a combined $120 per year to keep it open, thanks to the monthly fee.

Chase and Navy Federal Credit Union pare back promotional offers

Two issuers monitored by CreditCards.com also trimmed promotional offers this week.

Chase dropped a 12-month 0 percent balance transfer offer on the Chase Sapphire Preferred Card after offering it to at least some web visitors last week. Consumers who want a Chase card with an interest-free balance transfer offer are now limited to the Chase Slate card, the Chase Freedom card or the Chase Freedom Unlimited card – all of which offer a 0 percent APR on purchases and balance transfers for up to 15 months (then a variable APR of 17.24% – 25.99%).

Meanwhile, Navy Federal Credit Union stopped offering a promotional 1.99 percent interest rate on the Navy Federal Credit Union cashRewards card. Navy Federal Credit Union members who are looking for a promotional balance transfer offer are now limited to just the Navy Federal Credit Union Platinum card, which advertises a 12-month 0 percent balance transfer offer.

See related: Guide to rising credit card interest rates

Survey: Rates are likely to keep climbing in 2019

Average rates on new card offers are currently at their highest point since CreditCards.com began tracking rates in mid-2007. As a result, many cardholders are now paying significantly more than they did 10 years ago to carry a balance.

Cardholders hoping for a reprieve are unlikely to see one anytime soon. According to a recent survey of economists by Bankrate, the Federal Reserve is likely to raise rates at least one more time over the next year, causing APRs on a wide range of variable rate loans, including credit cards, to rise. When the Federal Reserve raises interest rates, the APRs on most variable rate loans increase at the same time or soon after.

Sixty-seven percent of the 21 economists Bankrate surveyed predict the Fed will likely raise rates sometime over the next year.

The Fed recently signaled it may slow down its gradual rate hikes this year. However, just 33 percent of the economists who spoke with Bankrate predicted the Fed will hold off on hiking rates altogether. Meanwhile, none of the economists surveyed predicted the Fed would slash its benchmark interest rate.

“The economy is still strong enough to absorb one or two more increases,” said economist Bernard Markstein in an interview with Bankrate.

If so, that could cause cardholders’ credit card APRs to increase by 0.25 to 0.5 percent – an amount that can potentially add significantly more debt to cardholders’ balances.

CreditCards.com’s Weekly Rate Report

Avg. APRLast week6 months ago
National average17.64%17.64%16.92%
Low interest14.63%14.63%13.99%
Cash back17.58%17.58%17.09%
Balance transfer16.87%16.87%16.21%
Business15.24%15.24%14.59%
Student17.79%17.79%16.98%
Airline17.50%17.50%16.93%
Rewards17.51%17.51%16.92%
Instant approval20.06%20.06%19.45%
Bad credit25.33%25.33%24.18%
Methodology: The national average credit card APR is comprised of 100 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.)
Source: CreditCards.com
Updated: March 6, 2019

What’s up next?

In Rate Report

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A new CreditCards.com poll finds only 15 percent of Americans have swapped out their go-to credit card in the past year. Meanwhile, 30 percent have never changed the card that sits atop their wallet.

Published: March 6, 2019

See more stories
Credit Card Rate Report Updated: June 19th, 2019
Business
15.61%
Airline
17.54%
Cash Back
17.68%
Reward
17.57%
Student
17.79%

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