Maximizing The Potentials Of A Low APR Credit Card

A credit card, if used properly, can be a great financial tool. Most people however can’t afford all the expensive rates some credit card institutions offer. For this we have what they call a low APR credit card. This is to help people who plan to maintain a balance on their account not to pay the full amount on a monthly basis. So what exactly does APR stand for in a low APR credit card?

In simple terms, APR is the cost of credit as an annual interest rate. APR stands for “Annual Percentage Rate” of charge can be used to compare different credit and loan offers and is generally calculated monthly based on the current amount in the card, meaning the monthly interest is calculated as if the current card balance would remain the same over a year. The interest over a year is worked out then divided by 12 to give you the monthly interest. It is the responsibility of the lenders to inform their customers what their APR before signing any agreement. Although the arrangements and terms may vary, it is better for people to gain a low APR credit card because the lower the APR, the better the deal for them to spend more money in shopping around.

Why choose a low APR credit card?

For people who have a tighter financial budget a low APR credit card is a viable choice. Being the most important aspect of a credit card, APR determines the noteworthy balance over a longer period of time. With an APR credit card the amount of interest you must pay is determined by the APR because the lower the APR is, thus meaning you pay less interest. You either get “fixed” or “variable” APRs.

One of the questions one has to ask themselves when planning on getting a low APR card is the charges, whether they are fixed or vary.  If you are considering a low APR card you may want to find a scheme that could help you save in interest with a low interest credit card and low cost processing. Most credit cards offer 0% APR in the first month on purchases, cash advances and balance transfers. Through these low APR credit card can warn rebates towards any item purchased.

Some low APR credit cards have excellent intro rates for purchases are recommended for those who want to benefit from it. They also offer better deals if one holds high balances on other cards and need to transfer the balance.

Having a credit can be very beneficial and useful and can build you a super strong credit history which we all know will help aid you in future financial plans such as home-buying, applying for finance or looking to finance your higher education goals and even help in finding you a job. Before you even think of applying for a credit card, consider all the options as well as the disadvantages and advantages of these options and taking your current financial situation into account before considering applying for any credit card.

Danny Aaron manages the website http://www.creditcardsandloans.co.za, a website devoted to offering the best credit card information for consumers in South Africa.

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