The best credit cards with the lowest rates are those that offer an introductory rate of 0%. Some of these include the Discover More Card, the MTV Visa Card from Capital One, Capital One Venture Rewards Card, Discover Open Road Card, and Citi Diamond Preferred.
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One of the biggest benefits of finding a credit card with a low rate is that it will save you money in the long run. If you choose a card with a low promotional rate, make sure you know what the interest rate will change to and when. Also, know that there are certain factors that can cause the interest rate to be higher for you than what is advertised.
Credit Cards with a Low Introductory Interest Rate
There are a number of cards that offer a 0% promotional rate. The promotional period ranges from six months to 36 months and the rates that it changes to vary from 9.99% to 21.99%. Each card with that rate also varies in regards to the benefits it offers as well as other terms.
When you choose a card that has a 0% interest rate, you should plan to pay off the balance before the term ends.
You will notice a big difference in the minimum due once it increases from 0% to let’s say 20.99%. Your money will not go as far. Unlike other credit cards, according to the Federal Reserve, the card company does not need to give you notice before the interest rate increases. This is why it is important to understand the terms.
Benefits of Low Interest Cards
If you are debating among the high number of 0% interest cards, keep in mind that there are different benefits associated with each one. The Discover More is a cash back card, earns up to 20% back, and has no annual fee. You also earn rewards from brand names and retail stores.
The MTV Visa has multiple bonuses as an entertainment rewards card. You get a high rate of return by earning five points for every dollar and there is no annual fee. Your points can be used for retail purchases and a number of entertainment related purchases and events.
The Venture One Rewards card from Capital One earns air miles with every purchase and also does not have a fee for annual membership. The Open Road card from Discover has multiple rewards linked to travel. When you use it to purchase gas, you receive 2% back. This can be redeemed for cash as well as retail rewards.
The Citi Diamond Preferred card does not have any rewards associated with it, but it does have the 0% rate for 18 months, which is longer than the other cards mentioned. It also does not have an annual fee.
Cards with No Introductory Rate
As was mentioned before, once the promotional period of time is over you are basically stuck with a high interest credit card. If you are planning to carry a balance on the card for a period of time, or you just want to have a card with lower interest rates, there are some cards out there that have lower rates than you will find with the one with introductory rates.
The Simmons First Visa Platinum has a purchase APR of only 7.25%. The PenFed Promise Visa credit card actually has an introductory rate of 7.49% and that lasts for 36 months. After that period of time, it increases to only 9.99%. Most of the cards that have a low APR will not have other bonuses such as rewards associated with them.
If you want a low interest rate on your credit card, you also need to have a credit score that is great or excellent. Unfortunately, if you have had a shaky credit history you will end up with a high interest credit card. SmartMoney can help you increase your score.
Another place you may be able to find a credit card with low rates is through a credit union.
If you are already a member of a credit union in your area, ask a representative what credit card terms are available to you.
If you are not yet a member of a credit union, there are a number of benefits associated with them. It has become easier to become a member as well. For one in your neighborhood, find it through MyCreditUnion.gov.
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