Credit Card Rates Stable for First Time in Nine Weeks
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For the first time in nine weeks, average credit card rates stayed the same, according to the IndexCreditCards.com weekly Credit Card Monitor. “Top-level” consumer credit cards averaged a 9.97% Annual Percentage Rate (APR), while consumer reward credit cards offered an average 11.27% APR. (IndexCreditCards.com uses “top-level” to describe Platinum or similarly designated credit cards that generally offer the lowest interest rates to eligible cardholders.) Business credit card rates held steady for the third straight week, at an average 9.99% APR for top-level business cards and an average 11.74% for business reward cards.
Average student credit card rates remained at an average 15.03%, after crossing the 15% line last week. “While it’s good to finally have a week without rate increases, this won’t last,” says Adam Jusko, Research Director for IndexCreditCards.com. “The Federal Reserve is likely to raise interest rates at next week’s meeting [December 13th], meaning the rates on variable-rate credit cards will probably rise again soon.”
Variable-rate credit cards offer interest rates based on a formula that includes a base rate plus a percentage tied to federal lending rates. When federal rates move up, as they are doing now, credit card rates follow. “As always, our averages are based on the best rates published by credit card issuers,” says Jusko. “If your credit is not top-notch, expect rates about 2% higher than those quoted here. If your credit is poor, obviously your rates may be even higher.”
Financial institutions represented in the survey include Advanta, American Express, Bank of America, Capital One, Chase, Citi, Discover, MBNA, National City, Providian, Pulaski Bank, U.S. Bank, Wachovia, Wells Fargo and more.
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