Credit Card Question

Hello group,

Don`t want to sound daft but ......... If a credit card, for example Capital One has a intrest rate of 29.9% is this per month or per year?

I.E - If i had 1000 on my card would the intrest of 29.9% make it a balance of 1299.00 for my next statment?

Many Thank MCN

Reply to
MadCrazyNewbie
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No, that's the APR, which has little if any connection with what actually happens. If you look in your terms and conditions, it probably tells you that 2% of the outstanding balance will be added to the sum outstanding at the statement date each calendar month. In other words, £1,000 with nothing paid off will rise to £1,020.

Reply to
Terry Harper

Per year.

APR = Annual Percentage Rate.

Reply to
Doug Ramage

Watch out, many cards that offer interest free periods for balance transfers put the interest free portion into their headline APR rate. i.e.

First 6 months 1000 @ 0.0% Second 6 months 1000 @ 20.0% APR is 10% for year one (Year two has an APR of 20% but by then you've already got the card)

Reply to
Peter Ibbotson

How so?

2% pcm compounded for a year: (1.02)^12 = 1.268, so £1000 would rise to £1268

Robert

Reply to
Robert

I make it about 9.5%

Reply to
Jonathan Bryce

Per year. It's not such a daft question.

If a pawnbroker quoted a rate of 25% this could be per week!

Reply to
dp

Because he was talking about his "Next Statement", which comes one month later.

Reply to
Terry Harper

Quite possibly, I always end up looking at the monthly numbers then figuring it out from there by hand. I'm still unhappy about this tactic by the card issuers, while "correct" it's a bit odd when they're talking about the "goto" rate. Certainly Capital one does this with some literature I got through the post.

Reply to
Peter Ibbotson

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