Why is my APR so high?

Discuss anything related to interest rates & fees, like balance transfer offers, low rate cards, annual fees, etc.
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VictorM
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Why is my APR so high?

Postby VictorM » Tue May 22, 2012 4:51 pm

I recently applied for a USAA Platinum card and was instantly approved. The main reason I applied was because of USAA interest rates. I checked mine and the regular APR is at 23.99% with a credit limit of 12k, is that high of an APR normal for being a new member?

The highest APR card I have is a Citi American Airlines card @ 15.99%. With the lowest being 6.99%.

I pay all my credit cards in full each month, but I don't think 23.99% is a reasonable APR for my credit score. Experian 750 Transunion 761 Equifax 755 with 10% credit utilization. Why is it so high? Is there a way I can get my APR reduced?

Thanks,
Victor


agp
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Postby agp » Wed May 23, 2012 6:08 am

My Chase freedom is also 22.99%. I'm going to say APR is calculated based on your credit score and payment history. If you pay your bills on time, you will have a good payment history. At the same time, if you pay your bills on time, you shouldn't be worried about APR.

Main Card: Amex Platinum
For gas: Penfed Platinum Cash Rewards
For travel & dining: Chase Sapphire Preferred

DavidNY
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Postby DavidNY » Wed May 23, 2012 9:55 am

Why did you choose this card?

I was surprised to find the Fidelity cards have a 13.99% APR, which is quite good for a rewards card.

My Chase Freedom APR is 15.24%. Surprised it would be 22.99% unless there was a late payment.

DoingHomework
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Postby DoingHomework » Wed May 23, 2012 4:43 pm

I could not even tell you what the interest rates are on my cards. You should never carry a balance and if you don't then the interest rate makes no difference.

VictorM
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Postby VictorM » Wed May 23, 2012 5:24 pm

I wanted to start building a relationship with USAA because eventually I want to switch over my auto and home Insurance. Not only that, but they also have great auto loans here in Texas. I figured applying to this card would be my foot in the door.

Agreed, I was just curious. Since most of my cards APR's are not that high. I figured someone in this forum would have some information on why USAA credit analysts would classify me at a high risk.

PopiLopi
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Postby PopiLopi » Wed May 23, 2012 7:35 pm

Currently my lowest APR is 19.99% on Discover and Cap 1, the highest is 24.95% on a Macy's card... My freedom is also 22.99%, I guess it's because I have a really short credit history, but if you pay your balances in full every month APR's should be the least of your worries
Amex: Business Platinum (09/12) BCP $10,500 (03/13)
Visa: Capital One Journey $750 (04/11) Chase Freedom $1,800 (04/12)
MasterCard Citi AAdvantage Platinum Select $8,500 (05/13)
Discover: Discover It $2500 (07/11)
Store Cards: Amazon $3900 (12/11) Macy's $500 (04/11) Kohl's $500 (05/12) Victoria's Secret $750 (11/12)

rockyrock
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Postby rockyrock » Tue May 07, 2013 8:59 am

I too am on the hunt for a low APR card. USAA has a plain no frills Platinum MC that starts at 7.99%. I have a rewards based card with them now and just called to see if I could get the APR lowered—no luck, still at 11.99%. I also asked if I could convert my current card and they said no, I would have to apply for the new one and if I wanted I could close my current or keep it. I knew that would be the answer but it never hurts to ask. Not sure if I’m ready to pull the trigger on more credit just yet and I for sure don’t want to close an account and jack my AAOA…

While on the phone with them I asked if they could lower the APR on my vehicle loan. Did a little better this time, they dropped it three quarters of a point to 3.24%--not rock bottom but not bad I guess.

All in all USAA is a great company to do business with. In addition to the aforementioned products I have life insurance, property insurance, and vehicle insurance with them. Website is great and easy to use and the CSRs have always been above average.
American Express (2005): Premier Rewards Gold & Blue Cash Preferred
Chase: Freedom & UA Club USAA: Signature Visa & American Express
Discover it Bank of Hawaii Hawaiian Airlines WEMC Synchrony Sam's MC
Navy FCU Platinum Visa Citi Double Cash & AT&T Access MC

Sevenfeet
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Postby Sevenfeet » Tue May 07, 2013 1:34 pm

Honestly, I'm surprised that the quest for lower interest rates in cards isn't as valued as credit limits. A lot of people here and elsewhere have no problem with a large CL and a less than prime APR of 20% or more since they always believe they will PIF every month. First, the APR is also a pretty good measure of what the lender thinks of you as a customer. Second, sometimes life throws you loops where you might not be able to pay-in-full at a given period, and having higher than average interest rate cards will cost you money.

For example, my wife made an error this month and accidentally paid our daughter's expensive school twice this month. We'll make it up next month but that screwed up our cash flow, which is pretty tightly controlled these days. The fact that we have credit (and lots of it) gives us the flexibility to get through this and not end up in a sticky situation. In fact, if this had happened before my app spree of 2013, my family would have been royally screwed since we didn't have much leeway in the credit we had at the time. Now its "Oh well, we'll just pay it off in June. At least our interest rates on our cards are nice and low".
Cards:
American Express Platinum (NPSL)
Penfed Platinum Reward Visa ($28K)
Chase Freedom Visa ($25K)
Fidelity American Express ($20K)
American Express Blue Cash Preferred ($20K)
Bank of America Cash Rewards MasterCard ($20K)
Citi Thank You Preferred Visa ($9.5K)
Chase Sapphire Preferred ($7.5K)
US Bank Cash + Visa Signature ($7K)
Discover IT ($4K)

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Z06Biker
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Postby Z06Biker » Tue May 07, 2013 3:54 pm

I agree. Even if the intention is to pay in full each month, with all else being equal, why not gun for the lowest APR possible?

I'm surprised that given the OP's credit score, and the fact that you have to be either military, ex-military or closely associated with one of the latter to be a USAA member, that they would even offer you that high of an APR. My partner (ex-military) has two credit cards with them, both with phat limits, and both around the 7-10% APR range.

Like many other banks, after you show a few months of judicious usage and on-time payments, you can always call and request they lower your APR. I've found that half the time, they are happy to oblige.
AMEX: PRG Gold, Business Simply Cash, Business Costco, BCE.
Chase: United MileagePlus Club, Sapphire Preferred, Amazon Rewards
Barclaycard Arrival World Mastercard
HSBC Cash or Fly World Mastercard
USAA World Mastercard, USAA Platinum Mastercard
Wells Fargo Business Platinum
USC Credit Union Mastercard

rockyrock
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Postby rockyrock » Wed May 08, 2013 2:49 am

Sevenfeet wrote:Honestly, I'm surprised that the quest for lower interest rates in cards isn't as valued as credit limits. A lot of people here and elsewhere have no problem with a large CL and a less than prime APR of 20% or more since they always believe they will PIF every month. First, the APR is also a pretty good measure of what the lender thinks of you as a customer. Second, sometimes life throws you loops where you might not be able to pay-in-full at a given period, and having higher than average interest rate cards will cost you money.

For example, my wife made an error this month and accidentally paid our daughter's expensive school twice this month. We'll make it up next month but that screwed up our cash flow, which is pretty tightly controlled these days. The fact that we have credit (and lots of it) gives us the flexibility to get through this and not end up in a sticky situation. In fact, if this had happened before my app spree of 2013, my family would have been royally screwed since we didn't have much leeway in the credit we had at the time. Now its "Oh well, we'll just pay it off in June. At least our interest rates on our cards are nice and low".


I'm with you; we've learned to play the game pretty well and could survive a curve ball now and again but several in a row...

I think the way cards are marketed is different now; they are sold based upon what they can do not what it will cost you. I got caught up in it. It wasn't until I started reading through this forum I realized all my cards were rewards based with APRs in the 12%-16% range. Previously I hadn't cared about APR because I PIF each month; I also refused to apply for anything with a high APR range.

I still PIF each month but I certainly see the value in having a no AF low APR card--just in case. If something happens and I need credit for something other than point generation (or perks) 8% is much more appealing than 16% or even 12%...
American Express (2005): Premier Rewards Gold & Blue Cash Preferred
Chase: Freedom & UA Club USAA: Signature Visa & American Express
Discover it Bank of Hawaii Hawaiian Airlines WEMC Synchrony Sam's MC
Navy FCU Platinum Visa Citi Double Cash & AT&T Access MC



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