Glossary

Penalty APR

A penalty APR is a higher interest rate, often near 30%, that a card can charge after you pay late: on new purchases with 45 days' notice, and on existing balances once a payment is 60 days late.

Under the CARD Act, if the penalty rate is applied because of a 60-day late payment, the issuer must restore the old rate after six months of on-time payments. Not every card has a penalty APR.

Work it out

Credit Card Payoff Calculator

Where you’ll see it on RateHerald

Variable card APRs today19.74–28.74%The prime rate plus a margin of 12.74 to 21.74 points, on the 11 cards whose terms state their margin over prime.

Related terms

APR (annual percentage rate)The yearly cost of borrowing as a percentage: on a credit card, the interest rate on balances you carry; on a loan, the interest rate plus certain fees.
Minimum paymentA credit card's minimum payment is the least you must pay by the due date to keep the account in good standing, usually 1% of the balance plus interest, or 2% to 4% of the balance, with a floor of about $25 to $40.

Sources: CFPB: Regulation Z, 12 CFR 1026.55 · CFPB: Regulation Z, 12 CFR 1026.9