Interest rates on new credit card offers stayed put for the
fourth straight week, according to the CreditCards.com Weekly
Credit Card Rate Report.
The national average annual percentage rate (APR ) on new credit
card offers remained fixed at 14.91 percent Wednesday. This is the
11th time this year that average interest rates haven't budged.
This is also just the second time in four years that the
national average has remained unchanged for a month or longer. The
last time average interest rates remained unchanged for this long
was in March 2011 when average rates held steady for five straight
weeks. Prior to 2011, rates tended to either move up or down most
weeks as banks tested new card offers more frequently.
Credit card issuers left the promotional offer terms on new
cards unchanged as well. According to CreditCards.com data,
promotional APRs, balance transfer offers and annual fees have
remained the same for all 100 cards in the CreditCards.com database
Rates unchanged, but still hovering near
This year's stability in average rates is a welcome change for new
cardholders who have seen average interest rates rise by more
than 3 percentage points since 2008. The national average APR
has only risen twice this year and it hasn't risen by more than a
10th of a percentage point in more than 10 months.
Despite the smaller number of rate spikes, however, average APRs
have hovered near record highs since December. To get a sense of
just how far average rates have climbed since the depths of the
recession, consider this. A cardholder borrows $5,000 on a
credit card today and pays $100 monthly at 14.91 percent interest
will have to pay $2,863 in interest to clear the balance. That's
$1,011 more than the cost four years ago when the national average
APR was just 11.55 percent. (Calculator: How long will it take to
pay off your credit card balance?)
The good news is that despite the higher rates, many of today's
cards feature long-term 0 percent promotional deals and most of
these cards don't carry an annual fee. For example, among the 100
cards that CreditCards.com tracks:
- 22 cards feature a 0 percent promotional APR for 12 months or
more. Twenty-one of these don't carry an annual fee.
- 8 cards advertise a 0 percent APR for 15 months or longer.
None of them have an annual fee.
- 22 cards offer a 0 percent balance transfer deal for 12
months or more. Just one carries an annual fee.
- 11 cards feature a 0 percent balance transfer offer for 15
months or more. Ten don't have an annual fee.
Before the Credit CARD Act of 2009 was passed, analysts
predicted that annual fees would become ubiquitous once the bill
became law. That dire prediction hasn't come true, according to
CreditCards.com data. Among the 100 credit cards in our national
average database, just 26 cards currently have an annual fee,
ranging in size from $19 to $495. The average annual fee amount is
approximately $80. The median annual fee amount is $60. Most cards
that come with an annual fee are either secured cards or travel
rewards credit cards.