Lowest CC APR available

[Anonymous]

I'm fixing to apply for a few cards soon, and I'd like opinions on FIXED vs VARIABLE APR. Some prime lenders offer low fixed APR of 7.99-10% and they also combine it with either rewards or cashback perks similar to cards that have otherwise higher (variable) APR. So, is there anything I need to know about FIXED or is it pretty clear that if I can get those low fixed apr cards, that's what I should shoot for?

The reason why I ask is that all those companies retain the right to some day change those fixed rates to higher rates. I'd like to know if anyone has had experiences with a company hiking the originally low fixed apr to the point where it's no longer better than a low variable apr offered by thousands of other lenders. I'm of course talking about situations that weren't caused by some screw-up by the customer himself.

Bottom line, if I have a choice, I should shop for lowest fixed apr with everything else that I'm interested in, right?

[Anonymous]

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ficus wrote:
I'm fixing to apply for a few cards soon, and I'd like opinions on FIXED vs VARIABLE APR. Some prime lenders offer low fixed APR of 7.99-10% and they also combine it with either rewards or cashback perks similar to cards that have otherwise higher (variable) APR. So, is there anything I need to know about FIXED or is it pretty clear that if I can get those low fixed apr cards, that's what I should shoot for?

The reason why I ask is that all those companies retain the right to some day change those fixed rates to higher rates. I'd like to know if anyone has had experiences with a company hiking the originally low fixed apr to the point where it's no longer better than a low variable apr offered by thousands of other lenders. I'm of course talking about situations that weren't caused by some screw-up by the customer himself.

Bottom line, if I have a choice, I should shop for lowest fixed apr with everything else that I'm interested in, right?

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Personally I would go with low fixed.  Yes I have read stories of rates being raised but no more so than on variable cards.  The difference with variable is that they will rarely be as low as they fixed that you mention, moreover, they may not vary as much as they shuold.  If your T&Cs state that your rate will never go lower than 'X' then that is your rate regardles of what prime does, unless of course it goes up.  lol!!

Funny thing about those cards is that they don't adjust down but even if prime goes down, the minute it changes direction, the 'variable' interest rate starts to creep back up.  That being said you can wind up paying a higher rate when prime recvoers even though prime isn't as high as it was when you apped.

[Anonymous]

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Personally I would go with low fixed. Yes I have read stories of rates being raised but no more so than on variable cards. The difference with variable is that they will rarely be as low as they fixed that you mention, moreover, they may not vary as much as they shuold. If your T&Cs state that your rate will never go lower than 'X' then that is your rate regardles of what prime does, unless of course it goes up. lol!!

Funny thing about those cards is that they don't adjust down but even if prime goes down, the minute it changes direction, the 'variable' interest rate starts to creep back up. That being said you can wind up paying a higher rate when prime recvoers even though prime isn't as high as it was when you apped.

Thanks. I will continue to work on lowering my current variable APR cards by calling every 6 months, but for new cards, I'll go for the lowest fixed APRs possible. The thing is that since these cards also offer all kinds of perks, I'm not sacrificing much, if anything, but am gaining the ability to save on higher finances charges in the future.

[Anonymous]

I would go for the low fixed APR card.

However, I understand your fear. I have a fixed 5.9% APR on my MBNA card, which is now a BOA card - I thought BOA would have hiked it up after the buy-out. And ever so often, I get nervous when I get mail from BOA...lol...thinking it will be a notice about a hike...but this hasn't happened in the past 3.5 years I've had the card.

Message Edited by pjriverap on 10-17-2007 06:51 PM

[Anonymous]

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@pjriverap wrote:
I would go for the low fixed APR card.

However, I understand your fear. I have a fixed 5.9% APR on my MBNA card, which is now a BOA card - I thought BOA would have hiked it up after the buy-out. And ever so often, I get nervous when I get mail from BOA...lol...thinking it will be a notice about a hike...but this hasn't happened in the past 3.5 years I've had the card.

Message Edited by pjriverap on 10-17-2007 06:51 PM

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5.9% is a super APR! Do you know of any company that is offering anything lower than 7.99% (fixed)? I would definitely want to take a look. By the way, how much can your card carry?

[fused]

My DW has a BoA Worldpoints MC at 7.99%, Pulaski bank also offers a 7.99% MC and Visa with a special 6 month BT offer. I'm not too sure how stringent there underwriting is. Here's the link.

http://www.pulaskibank.org/index.cfm?afid=999

Message Edited by fused on 10-17-2007 04:33 PM

[Anonymous]

I would also go with a fixed rate.  However, do keep in mind, that somewhere down the road, the issuers might change your terms, and change your fixed rate to a variable one.  I've had this happen to me a few times.  Some credit card issuers will also offer you variable rates, but the rates will never be permitted to be lower than a certain percentage.  For example, they might offer you PRIME+1%, but stipulate that this rate can never be lower than 7.9%.  In short, I find fixed rates much more attractive than variable ones.

[Anonymous]

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@fused wrote:

My DW has a BoA Worldpoints MC at 7.99%, Pulaski bank also offers a 7.99% MC and Visa with a special 6 month BT offer. I'm not too sure how stringent there underwriting is. Here's the link.

http://www.pulaskibank.org/index.cfm?afid=999

Message Edited by fused on 10-17-2007 04:33 PM

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I appreciate it. I have already stumbled upon the Pulaski bank offer and have it in mind for when I apply for a few soon. Definitely good APR. I'm lining up all the 7.99% offers with options that interest me, but it looks as if currently no company has offers lower than 7.99% fixed. The times have changed. However, I think that if I got a bunch of variable-APR cards and then worked hard on trying to get them all down to as low as even 9%, I'd probably run into walls getting this close anyway. The lower you can get those variable rates the more time you'd have to wait to get the next decrease, and there'll be a point where the bank will not justify anything lower. What can you tell me about the Pulaski deal? How well-established are they? Or is this a recent move that they are trying to make because they are trying to make it in the game?

Message Edited by ficus on 10-17-2007 07:43 PM

[fused]

I haven't heard of any fixed rates lower than 7.99% here or on other credit forums but that doesn't mean they might not exist.

[Anonymous]

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@Anonymous wrote:

I would also go with a fixed rate. However, do keep in mind, that somewhere down the road, the issuers might change your terms, and change your fixed rate to a variable one. I've had this happen to me a few times. Some credit card issuers will also offer you variable rates, but the rates will never be permitted to be lower than a certain percentage. For example, they might offer you PRIME+1%, but stipulate that this rate can never be lower than 7.9%. In short, I find fixed rates much more attractive than variable ones.

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Change fixed to variable? So it's not just increasing the rate, they just turning the tables completely. I guess this is what they mean when they say "anytime, for any reason" on the T&C agreement. Under what circumstances did those things happen to you? Did you pull something or were all those times random occurances? Anything higher than 7.9% can easily fall under the category of "PRIME+1% but "CAN NEVER BE LOWER THAN 7.9%" depending on how they view it. :-) But I guess, nowadays, anything lower than 10% is better.