By CreditCards.com staff | Published: March 11, 2009
MAN 1: APR is…
WOMAN 1: Um, uh, oh…
WOMAN 2: U, something rate appreciative….um, I don’t know. [laughs]
MAN 2: APR is, uh, Annual Percentage Rate, so it’s the amount of uh, percentage of interest you pay per year.
What are interest rates?
MAN 1: Interest rates are the…[laughs]
MAN 3: Uh, they’re, uh….[laughs]
WOMAN 2: It’s the percentage that you’re paying on top of the money that they’re loaning you.
MAN 1: It’s where they, I guess, they make their profits; how they make their money, by offering you that service.
What happens if you miss a payment?
MAN 1: I know, ‘cause I’ve missed many payments.
MAN 2: If you miss a credit card payment, your rates will probably go up.
MAN 4: Uh, late fees, and if it goes too long, it will show up on your credit report.
How much will a pizza cost if you take 4 years to pay it off?
WOMAN 3: Er, probably like fifty bucks.
MAN 1: A lot more, uh, than what you originally paid for.
MAN 2: Let me work it out for a second.
MAN 1: It could take four years to pay off a pizza? Geez...
MAN 5: A lot more than it’s worth.
MAN 2: 227 dollars.
MAN 1: I mean maybe you shouldn’t be buying pizza with your credit card if it takes you four years to pay that off.
Take charge of your credit cards.
College students discuss their understanding of basic credit card terms - APR, Interest Rate, what happens if you miss a payment and how long it would take to pay off a purchase.
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.
If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.
The editorial content on CreditCards.com is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.
Three most recent Credit card videos stories:
Video: Drawing down debt – When it comes to getting rid of debt, you've got to be creative and one artist took that idea to a new level when she drew out the statements of every one of her credit cards until they were paid off ...
Video: Brews and banking with Capital One – Banks like Capital One are reaching out to customers in a new way, by giving a Starbucks experience to visitors and giving them a chance to get their banking questions answered along the way ...
Did you like this story? Then sign up for CreditCards.com’s weekly e-newsletter for the latest news, advice, articles and tips. It's FREE. Once a week you will receive the top credit card industry news in your inbox. Sign up now!
CARDMATCH™ is a free, secure service that will not affect your credit score. Simply provide your basic information, and view offers that match your credit profile within seconds.
