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Why are there lowapr credit cards?
Everywhere you look credit card companies are offering lowapr credit cards. With all the competition, it can only serve to help the consumers with a plethora of available options to choose from. Not only do the companies offer a lowapr they have bundles it with airline miles, cash back incentives and may other perks to entice consumers to choose their credit card.
The credit card companies are looking to capture new customers who've never had a credit card. Also they are looking for those who already have a credit card balances that might be willing to transfer that balance to the new lowapr credit card the company is offering.
You might ask yourself why would a credit card company try to save you money at the expense of them not making money. Well studies on how consumers pay off their balances prove that they are more likely to carry a balance on their credit cards for years after the introductory offer never paying it off until they “transfer the balance” to a new credit card offer. Usually the lowpar offer rate will rise after the initial introductory period.
With this in mind, you can see why the credit card companies will entice you with lowapr offers even 0 par offers to get you on their card. They are anticipating that you will carry a balance over years and they will earn the interest over the life of the carried balance instead of another credit card company benefiting.
According to credit card surveys, most households have over $7000 they carry month to month on their credit cards. That’s lot of interest being earned even with a lowapr charged by the credit card company.
So if you choose to go with a lowapr credit card offer, remember to consider the fact if you are not planning to pay off your balance completely during the introductory period, would it be better to stay with you current card.
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