I always assumed that credit card APR’s were basically set at the legal limit. Obviously I’m talking junk like this not competitive cards that want people with good credit’s business.
I didn’t even know there were still “usury” laws, it sounds so archaic.
There is no federal regulation on the maximum interest rate that your issuer can charge you, though each state has its own approach to limiting interest rates. There are state usury laws that dictate the highest interest rate on loans but these often don’t apply to credit card loans.
I would be curious what percent of revenue on the collective cards is from annual fees/transaction fees vs interest? Maybe I’m overly naive but are there really people shelling out 600/yr on a travel card and then paying interest on it?
My credit card rates could be 500% interest for all I know
Yeah I don’t generally pay credit card interest so same page here… but I’ve definitely gotten offers that were centralized around the rate.
Credit Card companies are effectively Greenpeace compared to payday lenders.
When we moved we were able to get our family credit card and our savings/checking with the same bank.
The very first month the internal payment system somehow paid off the credit card balance late. We were going to get charged penalties and lose our grace period and get charged interest (gasp).
Nobody on the phone was of any help. Pretty much tough nuts.
My wife got the local branch manager to go to bat for us and got it fixed. For some reason we hung on. I would have axed ever banking with them again.
Credit cards work for us. Not the other way around. Yeeesh. (And I played plenty of interest with the first wife, exactly $0 cc interest with the 2nd).
Having been in debt to each at different stages of my life I strongly agree.
Yeah, I don’t pay credit card interest either becuase, lol, if i really needed a loan there are so many better options than 20 percent interest. But so many people do pay credit card interest for no other reason than they suck at math.
Or, they are living paycheck to paycheck and have no other way to make ends meet.
Fair, but I have known just so many people in my life who are most certainly not living paycheck to paycheck, and who almost certainly have access to other forms of credit, who nonetheless carry a balance on their credit cards.
I did not work for ~7 months and didn’t really have income. I decided to incur some debt instead of blow through the remainder of my savings, so I tapped my ~75k credit line. I’m paying like $75/mo in interest. It’s just a cost of what happened for me, I’m fine with it. Credit cards have their uses, most people don’t use them correctly though, that’s true. I mostly use it like a debit card, and pay off the full balance every month. This was the first time I didn’t, but it was an emergency.
I have 800 credit score though so I tend to get really good deals.
You should be able to get an offer for a 12-month interest free card, so if you’re going to carry that debt for a while you can transfer it at a cost of probably a 1% to 3% one-time fee, then no interest for 12 months. Should save you a decent chunk of interest.
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Can confirm, this is how I carried consumer debt through my early 30’s.
Yeah this is the way to do it. Worst case scenario you are effectively paying 1-4 percent APR on zero interest (but they have a fee!) balance transfer cards. If you are a real pro you get the zero interest intro offer on purchases cards and gradually cycle through those by “manually” transferring the balance. This is accomplished by only paying off the old card while you accumulate debt on the new one. That can keep you at a true 0 apr loan for years if you do it right.
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way too much work
It’s really not though, and literally saves thousands of dollars a year in interest depending on your debt level. You’re talking about credit card applications and balance transfer applications that can be filled out online in minutes.
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lifetime I’m less than $1k on cc interest, but I’ll look into it. saving a few hundred bucks vs managing another new card/account is meh for me. I did find a cool service though that consolidates all your accounts into one place.
The numbers you were talking about made it seem like you had paid a lot more in cc interest than $1k. I’m guessing you weren’t floating debt on cards that charged 27 percent APR then, at least not at a high level?
no I dont know what APR it is but I’m paying less than $100/month for the last several months. I dont feel like doing the math right now but it isn’t nuts. I probably gave the impression that I have 75k on the card, that isn’t the case, much less than that.
It’s primarily in the BOA ultra rewards card that gives blanket cashback 2% + 10% on cashouts if deposited to a BOA account. great card
Yeah 20 years ago I saved hundreds if not thousands of dollars on these weirdo balance swaps on my 4 figure CC debt for a little while until I was able to pay it off, essentially 0% apr loan for a while if you put in the work and have the score for it. One of the very few redeeming features of our credit system.
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