The national average APR remained at 15.01 percent Wednesday, after rising the previous week. Bank of America did raise the maximum possible APR an applicant could receive on two of its basic credit cards, the BankAmericard Visa and the Bank Americard for Students.However, the change to the cards' highest available interest rates didn't affect the national average because CreditCards.com considers only a card's lowest possible rate when calculating average interest rates.
BofA widens APR ranges
Since the beginning of the year, very few credit card issuers among those tracked by CreditCards.com have changed the low end of their available APR ranges on cards. However, a number of issuers have widened the range of possible APRs that a cardholder may be offered by increasing the maximum available interest rate on select cards.
Bank of America became the most recent issuer to widen its APR ranges when it increased the maximum possible rate on several cards.
The bank has been slowly rolling out APR changes for the past several weeks. To cardholders with less-than-perfect credit, the changes haven't been favorable.
In each case, the bank has widened the APR spread on a select number of cards by hiking the maximum available APR by 1 to 2 percentage points.
As a result, all five unsecured Bank of America cards tracked by now feature APR ranges as wide as 8 percentage points or more. As of press time, Bank of America did not respond to a request for comment on the recent changes.
Wide APR ranges relatively common
Bank representatives say the wider ranges allow issuers to offer the same card to a larger group of people, including those with flawed credit. Consumer advocates argue that the wide APR ranges make it next to impossible for consumers to intelligently comparison shop, since they don't know which interest rate they will be offered until after they apply for a card.
It's become common for cards to advertise ranges of 8 to 10 percentage points, and a few cards feature APR ranges as wide as 16 points.
CreditCards.com tracks 100 cards. Eight feature maximum APRs that are more than twice the size of a card's minimum APR. Thirty-nine cards feature spreads as wide as 8 percentage points or more.
The average APR for consumers with imperfect credit, meanwhile, is now 20.9 percent -- 5 percentage points higher than the national average.
Despite higher APRs on some cards, applicants with lower scores do have one silver lining. It's become slightly easier to get a new credit card in recent months, according to Federal Reserve data and at least one major bank has reported lowering the minimum required credit score to get new plastic.
Source:
CreditCards.com
