Low-Interest Credit Cards: How They Can Help You, Plus 7 Top Options

The average American carries roughly $5,270 in credit card debt. That’s why it’s important to know your interest rate when opening a credit card; if you carry a balance on a card with a high interest rate, your debt can grow quickly. 

Of course, credit card interest rates can fluctuate based on a variety of factors — not all of which are within your control. Knowing what different cards have to offer will help you make the right decision.

In this article, we’ll look at the basics of low-interest credit cards, including what it takes to be eligible and how you can minimize your debt even if you don’t currently qualify for one. You can also discover some of the best low-interest cards available today. 

What is a credit card interest rate?

The interest rate on a credit card is the rate that a lender charges you to borrow money. If you pay off your credit card on time and in full each month, you don’t need to worry about interest charges. 

For example, if you charge $800 on a credit card during your billing cycle, your statement will reflect that balance. If you pay the full $800 by your statement due date, you will not have any interest to pay. If you pay only a portion of the balance, you will be charged interest on the remaining balance, which increases the total amount you owe. 

Credit card companies refer to the interest rate as the annual percentage rate (APR). As of November 9, 2022, the average purchase APR for credit cards in the U.S. hit a record high of 19.04%. A low-interest credit card would be one that could help you get a lower interest rate than the average. 

What you should know about intro APR rates

At times, credit cards can start out with a low interest rate or no interest rate but then will become a high-interest card after. This is because lenders may offer an introductory APR when you open a new account. 

A common intro APR is 0% for the first 12 to 18 months of account opening. As long as you make the minimum payment each month, your credit card issuer will not charge interest during this promotional period.

After the intro APR period expires, the regular APR becomes the standard interest rate. However, if you miss a payment or make a late payment, your credit card issuer will immediately void the introductory APR and replace it with the regular APR or a penalty APR. You may also be charged late fees.

A good time to take advantage of an introductory APR is when you’re making a large purchase that you don’t have the cash for right away but will be able to pay off by the end of the promotional period. 

For instance, let's say you just moved into a new home and need to buy a couch that costs $1,500. You charge this purchase on a card with a one-year promotional 0% APR offer. You pay $125 per month on the card for 12 months. Since the balance is paid off before the intro APR ends, you won’t have to pay any interest on the purchase.

However, let’s say you only made $100 monthly payments toward the balance. By the time the promotional period ends, you would’ve paid $1,200. A higher interest rate will go into place when the period ends, and you will be charged interest on the remaining $300 balance.

Eligibility requirements for a low-interest credit card

The eligibility for low-interest cards varies from lender to lender. 

If you have an average credit score — about a 680 FICO Score — you’ll likely qualify for low-APR credit cards. However, due to your lower credit score, the card may come with a few drawbacks, including a low credit limit, annual fees or few (if any) bonus points. 

If you have excellent credit — a FICO Score of 800 or more — you will likely qualify for a low credit card interest rate with other potential benefits, such as a cash-back rewards program. 

Be mindful of how often you apply for credit cards. Every time you apply for a new card, the financial institution will check your credit report using a hard inquiry, which will ding your credit score by a few points. 

If you apply every once in a while, it's not a big deal. But if you have poor credit, continually submitting applications will make it even more difficult to build your credit. 

Some lenders allow you to enter some basic personal information — such as your name, address and income — to determine whether you’re eligible for their card. In these cases, lenders perform a soft inquiry that does not harm your credit score. 

If you’re deemed eligible, you can apply. The lender will then conduct an official hard inquiry when receiving your application. Be sure to read the fine print before officially applying. 

The 7 best low-interest credit cards available today 

If you want to apply for a low-interest credit card, consider the following options. Terms apply to any card, so be sure to read the fine print before you submit an application. Remember, the APR range for the card will depend on your creditworthiness. The better your credit score, the lower your interest rate will be.

1. Discover it Cash Back Credit Card 

The Discover it Cash Back Credit Card has no annual fee and offers 5% cash back on rotating bonus categories throughout the year (such as grocery stores, gas stations and Amazon.com) and 1% cash back on all other purchases.

This cash back card has a 0% intro APR for the first 15 months on both purchases and balance transfers. After the end of the introductory period, it has a standard variable APR ranging from 14.99% to 25.99% – one of the lowest rates you’ll find today.

2. Quicksilver from Capital One 

Capital One’s Quicksilver rewards card has a 0% intro APR for 15 months on both balance transfers and purchases. After that, the card has a variable APR between 17.99% to 27.99%. The card offers unlimited 1.5% cash back on all purchases, and during your first year, you can actually earn 3% cash back on every purchase.

The Quicksilver card has no foreign transaction fees or annual fee, and it also has a variety of perks for cardholders, such as exclusive access to entertainment presales or the ability to use rewards with PayPal or Amazon.

3. Blue Cash Everyday Card from American Express 

The American Express Blue Cash Everyday Card offers an excellent rewards program for everyday purchases. Cardholders receive 3% cash back on grocery store, gas station and online retail purchases up to $6,000, and 1% cash back on all other purchases. 

American Express also offers a $100 statement credit if you spend $2,000 within the first six months of opening the account. The card has no annual fee and carries a variable APR that ranges from 17.74%-28.74%. 

4. Wells Fargo Reflect Card 

The Wells Fargo Reflect Card offers a 0% introductory APR for the first 18 months with the potential to extend the intro period by three months if you make on-time payments during the first 18 months. 

As of November 2022, the card’s APR varies between 16.74% and 28.74%, depending on the borrower’s creditworthiness and the U.S. Prime Rate. Additional card benefits include cell phone protection and emergency roadside assistance.

5. Citi Diamond Preferred Card

The Citi Diamond Preferred Card stands out because it has an extended introductory period. There is a 0% APR on balance transfers for the first 21 months from the date of account opening, and a 0% intro APR on purchases for the first 12 months from the date of account opening. 

The card offers a variable APR ranging from 16.74% to 27.49%. You also receive free access to your FICO Score online. 

6. BankAmericard from Bank of America

The BankAmericard is offered by Bank of America and comes with 0% intro APR for the first 21 billing cycles for new purchases, with no penalty APR for late payments and no annual fee.

After the end of the intro period, the regular APR currently varies from 14.99% to 24.99%. This card also provides a $0 liability guarantee for unauthorized charges.

7. Chase Freedom Unlimited

Chase Freedom Unlimited is a Visa rewards credit card that is popular for its wide range of bonus categories. This card offers 3% cash back on restaurant and drugstore purchases, 5% cash back on travel purchased with Chase Ultimate Rewards and 1.5% cash back on all other purchases. 

The Chase Freedom Unlimited card offers a 0% intro APR for the first 15 months and then a regular variable APR that ranges from 17.99% to 26.74%. There is no annual fee, and rewards points never expire. 

As of November 2022, new applicants are eligible for a bonus offer where they can earn $200 if they spend $500 within the first three months of opening their account and 5% cash back on grocery purchases up to $12,000 during the first year with the card.

Minimize debt with low-interest credit cards 

If you pay off your credit card balance in full each billing cycle, then you don't need to worry about your APR, since you won’t accumulate interest. But if you don’t pay in full each billing cycle, your debt can increase. In these circumstances, a lower interest rate is critical since it reduces the amount of interest charged. 

If you have a strong credit history, you can apply now for a low-interest credit card. Our list of the best low-interest credit cards is one way to start your search. 

If you already carry balances on credit cards, check out the Tally† credit card payoff app. The app helps you manage all your cards in one place, and a lower-interest line of credit can help you pay down your higher-interest balances efficiently.

†To get the benefits of a Tally line of credit, you must qualify for and accept a Tally line of credit. The APR (which is the same as your interest rate) will be between 7.90% and 29.99% per year and will be based on your credit history. The APR will vary with the market based on the Prime Rate. Annual fees range from $0 - $300.