Interest rates on new credit card offers held steady for the
second straight week, according to the CreditCards.com Weekly
Credit Card Rate Report.
The national average annual percentage rate (APR) on new card
offers remained at 14.97 percent Wednesday.
None of the cards that CreditCards.com tracks featured offer
changes this week. That includes changes to promotional balance
transfer offers and short-term promotional APRs.
The lack of change is nothing new, however. Back-to-back weeks
in which card offers remain the same have become the norm this
year. For example, this week marks the 20th time this year that
average interest rates haven't budged.
In the rare instances that average rates have increased or
declined, the changes have been nominal. The last time average
rates changed by close to a full percentage point from one week to
the next was in January 2010.
Consumers are still contending with relatively high rates,
however. Average interest rates may not be much different from what
they were a year ago, when the national average APR hit 14.88
percent. However, they are significantly higher than they were
during the same period three years ago when average rates hovered
just above 12 percent.
Many consumers are also dealing with significantly higher rates
than the national average. CreditCards.com only considers the
lowest possible APR on a card when calculating the national
average. However, many cards that CreditCards.com tracks feature
wide APR ranges. As a result, customers with less-than-stellar
credit are being offered higher APRs than the lowest advertised
rate.
Among the 100 cards that CreditCards.com tracks, 60 cards
feature a range rather than a flat APR. Among those 60 cards:
- 15 cards feature a 4- to 6-point difference between offered
annual percentage rates.
- 25 cards feature a 7- to 9-point difference between offered
rates.
- 18 cards feature a 10- to 13-point difference between
rates.
- 2 cards feature a 14- to 16-point difference between offered
interest rates.
To get a sense of just how far apart average rates are for
consumers with different credit scores, consider this. The average
APR for cards offered at the top of the APR range is a whopping
19.99 percent. That's more than 5 percentage points higher than the
national average. Critics say the wide APR ranges make it tough for
consumers to guess what rate they'll actually get when they apply
for a card. However, proponents say that the wider ranges allow
banks to offer the same card to a larger group of
consumers.
Among the cards that CreditCards.com tracks, the credit card
with the widest APR range continues to be the USAA World
MasterCard. That card features a range of 9.90 percent to 25.90
percent.