Credit card usage is very convenient and efficient, but this convenience and usefulness comes at a price. We know this price as the interest rates applied on credit cards. You have to pay interest rates on credit cards and there is no way to escape that. This is exactly one of the topmost reasons why you should grab any introductory APR rates with low to 0% APR for a fixed period of time. But before you do that you ought to understand what APR means.
What is introductory APR?
Introductory APR refers to the rate of interest that is being introduced along with a new credit card. This is usually a part of the promotional activities and the aim is to make the credit card seem more attractive to the consumers. Obviously it means that the introductory rates will be different from regular rates that are applied on the credit card.
Also, the introductory rates have to be much lower than the regular rates in order to appear attractive to the consumers, or why would they even bother checking it out?
Usual range of introductory APR
The most common kind of introductory APR rates that we are seeing nowadays with almost every new credit card is the 0% APR. There cannot be anything lower than this rate and that is what makes the credit card that comes with such offers seem irresistible to the masses. Others also offer 70-80% lower APR interest rates when compared to the regular rates applied on that card.
Are introductory APR rates beneficial?
Well, the answer to this question depends upon how you use the credit card that comes along with the introductory APR rates. You need to understand the limitations and terms and conditions that go along with the introductory rates that are usually written in fine print.
The first limitation is that the low / nil interest rates are applicable only for a certain time period. Just because you signed up for the low introductory rates offer does not signify that those rates will stay for as long you use the card.
No, on the contrary the introductory rates are applicable for a limited time and you will have to find when this period ends exactly, because it is usually different for different credit card companies.
How to get the best of introductory APR rates?
Introductory APR rates are best used for purchases. If these rates allow you six months to 1 year of interest free period/low interest period, then you should make use of this chance to make new purchases within this period. But take care to manage your repayment schedule in such a way that none of the balance is carried forward beyond the period where the introductory rates apply.
Because if you still have some amount of outstanding amount carried forward into the regular interest rate period, you will have to pay higher rates.
Introductory APR offers by credit card companies are a golden chance to take maximum advantage of credit cards as long as the golden interest free period reigns.
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