But this is not always the case because the APR also takes into account any monthly or annual fees you pay for having the card.Īmy’s story – an example to show how compound interest works The APR is based on the interest rate charged on purchases and will usually be the same as the compound purchase rate. This is the APR you are most likely to get if you are successful because some card issuers give different APRs to different customers. In advertising, lenders use a rate called the representative APR. You can also use your compound standard rate to compare against the APR of another card, unless the other card has annual or monthly fees.Īn APR is a rate that is used to give people a standard way of comparing the costs of different credit cards, before they apply. Comparing to APR (Annual Percentage Rate) This means that you can use the standard and cash compound rates on your Barclaycard to compare against the purchase and cash interest rates on most other credit cards. Most credit card issuers just show compound interest rates. Comparing to purchase and cash interest rates
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