Credit Card interest rates in 2015
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Using credit cards responsibly can be one of the simplest ways to build your credit score, but the large variety of different available options and offers means that you need to research thoroughly to be sure you are fully aware of what you are actually signing up for. It’s important to shop around and to be aware of the different catches that might be hidden behind great introductory offers. This is especially true of balance transfer cards, which often have very high interest rates which kick in at the end of the interest-free period. So whilst they can be a great tool for reducing debt, there is also the hidden danger of high fees at the end of the 0% interest period.
The average interest rate charged on credit cards is now 20.6% APR (Annual Percentage Rate), a significant increase from 15.3% APR in 2006, when the records began.* So now, more than ever, having a good credit score comes in useful when you want to shop around for the best rate and rewards. The current rules governing credit cards mean that only 51% of those accepted for a card have to receive the advertised APR, which means that 49% will be charged more than expected on any balance that they carry over.
Protecting and building your credit score and looking after your credit report will make sure that your credit score is the best it can be. A better credit score usually means a better deal and a lower interest rate on your credit card.
Remember to always check whether your credit score is up to scratch before applying for a credit card, as a rejection can lower your score. ClearScore is here so that you can be in control of your credit report and credit score for free, forever.