The Best Low Interest Rate Credit Cards

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The only thing more challenging than managing credit card debt is getting out of it. To accomplish this important goal you need a sound budget, plenty of discipline, and a credit card with the lowest possible interest rate. (See also: The Best 0% Balance Transfer Cards)

How to Find the Lowest Interest Rates

Every bank is legally required to clearly disclose each card's Annual Percentage Rate, or APR. This is the rate you will see in the black and white box when you click on the "terms and conditions" link. While you might think these disclosures make choosing the lowest APR an easy task, it is not that simple. Most banks will disclose a range of possible rates, with each applicant being offered a particular APR according to his or her credit rating. Therefore, the lowest rates available will be granted only to those applicants with the highest credit scores, with all other cardholders receiving higher rates.

Another important aspect of a credit card interest rate is that nearly all of them will have a variable rate. The good news is that the CARD Act of 2009 prevents banks from arbitrarily raising their rates on cardholders in good standing. What you will find is that nearly every card on the market will offer a variable APR that is based on the Prime Rate. This rate, determined in part by the Federal Government, has stood at a record low of 3.25% since December of 2008. Nevertheless, the variable interest rates quoted by the credit card issuers will rise when the Prime Rate does. For example, if the Prime were to rise to 8.25%, as it did in June of 2006, cardholders would see their interest rate rise by 5% from the current rates.

Finally, the best interest rates offered for a particular card can vary based on the link you use to apply for it. For example, applications for Chase Freedom card mentioned below can be found in many different places, with a higher interest rate depending on the amount of initial cash back offered. I have even seen Capital One present different rates for the same card depending on which browser I used!

The Five Lowest APR Cards on the Market

These cards currently have the lowest interest rates.

Simmons Bank Visa® Platinum

Simmons Bank Visa® PlatinumThe Simmons Bank Visa® Platinum card has an unbelievably low rate equal to the Prime Rate plus 4% (currently that's 7.25%). This is the rare card that offers applicants a single possible APR rather than a range of rates. So if your application is approved, you will receive this great rate. Needless to say, applicants must have excellent credit in order to be approved. Want to save even more money with this card? There are no balance transfer fees and no annual fee.

Click here to apply for the Simmons Bank Visa® Platinum

PenFed Promise Visa

PenFed is not a bank, it is the Pentagon Federal Credit Union. Membership is free to qualified applicants, which includes many military and government workers as well as members of their extended family and households. Those who don't qualify on this basis can join after making a one-time contribution of $15 to a military charity. Once a member, you can apply for their Promise Visa card, which offers a fixed APR of 4.99% for 12 months, followed by a standard APR equal to the Prime Rate plus 7.99%. As if that wasn't good enough, this card has virtually no fees. That means no annual fees, balance transfer fees, cash advance fees, or foreign transaction fees. There are also no penalty fees for late payments, exceeding your credit limit, or having a payment returned. Missing a payment will hurt your credit score, but it won't even result in a higher interest rate.

Barclaycard® Ring Mastercard®

A relatively newcomer, the Barclaycard® Ring MasterCard® offers a 8% variable APR with no annual fees and no balance transfer fees! Capitalizing on the crowdsourcing popularity, this card offers members to shape the terms and conditions. Cardmembers can discuss issues with the card and vote on new ideas. It's a fun and simple card for those looking to provide some input and exert some control over their credit cards.

Click here to apply for the Barclaycard® Ring MasterCard® today!

U.S. Bank Visa® Platinum Credit Card

The U.S. Bank Platinum Visa® Card may look like a simple credit card on the surface, but its low interest rate can prove to be a very valuable asset on its own. New cardmembers will receive a 0% introductory APR on all purchases and balance transfers for 12 months after getting approved for the card. Then, it'll become a low 9.99%-20.99% variable APR, which can potentially give you more buying power when using this card. Cardholders will also receive a free Experian credit score if they sign up for online banking. There is no annual fee.

Discover it® Card

The Discover it® Card not only comes with a great low interest rate, but it also comes with some great cash back rewards to boot. New applicants will get to enjoy a 0% introductory APR on purchases and balance transfers for 14 months, and then a low 10.99%-20.99% variable APR will apply. Cardholders can also earn 5% cash back on purchases in bonus categories that change each quarter. They'll earn 1% cash back on all other purchases they make on the card. Additionally, Discover offers its cardmembers a free FICO credit score each month. There is no annual fee on this card.

Click here to apply for the Discover it® Card today!

Capital One® Platinum Prestige

Capital One offers the Platinum Prestige Credit Card which has few bells and whistles, but offers a great APR at 10.9% to 20.9% (variable). It currently offers new cardholders 0% APR on all purchases and balance transfers until June 2016. A 3% fee applies to each balance transferred. There is no annual fee nor foreign transaction fees and it comes with extended warranty protection (on eligible purchases) as well as their free Capital One Credit Tracker, which allows you to see your monthly credit score anytime.

Click here to apply for the Capital One® Platinum Prestige Credit Card today!

Wells Fargo Platinum Card

Rounding out the top five is a card from the legendary bank that dates back to the Gold Rush days. Their Platinum Visa starts off all new cardholders with a 0% introductory APR for 15 months on both purchases and balance transfers. The standard APR given to cardmembers after the introductory offer is 10.15%-24.99%. There is no annual fee, but there is an introductory balance transfer fee of 3% for up to 15 months (which becomes 5% thereafter) and a foreign currency conversion fee of 3%.

Although the best way to use a credit card is to avoid paying interest, most Americans are unable live up to this ideal. If you do have to carry a balance, your primary goal should be finding a card with the lowest interest rate. Doing so will help you to minimize the amount of interest that you owe, making it easier to pay off your credit card debt as soon as possible.

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Guest's picture

It's nice to see that my local credit union (Arkansas Federal) has a much better interest rate at 6.00% fixed (also not an introductory rate). I wonder if other credit unions or local banks have as good of rates? Anyone else getting better rates than 4% + prime?

Guest's picture

Finding the best low interest credit card is not easy. We have to compare many cards on various things as interest, annual fee, balance transfer fee, etc. So, I thank for your post on the best. Although we must to suit our financial capability and the goal of getting the low interest credit card.

Guest's picture

CommunityFirstBank in Harrison, Arkansas offers a Master Card with a no-teaser APR of 7.15%. No annual fee unless you opt for the rewards program. $35 annual fee with rewards.

Guest's picture
Alex @ Credit Card Xpo

While applying for a credit card with the lowest interest rate might be good for some people who don't always pay off their credit card bills and carry a balance each month. The lower the interest rate, the less interest charges they have to pay to the bank. However, if you are someone who always pay off their bills in full every month to avoid paying any interest charges, looking for a credit card with rewards is a better option.