How to Compare Low Interest Rate Credit Cards

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If you're someone who's pretty good at keeping your credit card balance low, but oftens leaves a modest balance to roll-over from month to month - getting a good deal on the interest you are charged is a great way to save yourself a chunk of money each month.

Interest rates are no longer at their lowest - and if your current card's rates have been on the increase now is the time to switch to a better deal.

Compare low interest rate credit cards or read on to find out how to compare, choose and apply online for a low cost credit card.

Low interest rate credit cards are best for...

- Frequent use and carrying a balance
Low interest rate credit cards are the best card choice if you tend to carry an outstanding balance on your credit card from month-to-month and want to benefit from lower rates of interest.

If you regularly use your credit card to pay for purchases, and although don't always repay your balance in full, keep on top of your spending and finances, a low interest rate credit card could save you money in interest charges.

Low interest rate credit cards offer a cheaper-than-most interest rate on purchases, and depending upon the card you choose, they may also offer a low interest rate on cash transactions too.

- A good credit history
Low interest rate credit cards will require applicants to have a good credit history and a regular income. This is because any outstanding balance on your credit card is being charged at such a low rate of interest.

There are many classic low interest rate credit cards available, which have less strict approval requirements than gold or platinum cards. Classic low interest rate credit cards include the Mint credit card, RBS Classic credit card and the Natwest Classic credit card.

However, the lowest interest rates will usually be found on the platinum low interest rate credit cards, such as the Capital One Platinum credit card and the Barclaycard Flexi-Rate credit card.

These cards are not suitable for...

- Large one-off purchases
If you are looking to make a one-off or several one-off purchases now, and you want to repay them over several months without accruing interest charges, then a 0% purchase credit card will save you more money as they offer 0% interest rates on purchases for up to a year.

- Balance transfers
If you have a large outstanding credit card balance that you are repaying slowly, you can save yourself money by transferring this balance to a 0% balance transfer credit card that offers 0% interest rates on balance transfers for an introductory period, for up to - and over - a year.

You may also want to consider the option of transferring the balance to a fixed for life balance transfer credit card that will offer a low rate of interest until you have repaid the balance in full.

- A poor credit history
If you know yourself to have a poor credit history and a bad credit rating you are fairly unlikely to be accepted for a low interest rate credit card.

If you need to get a credit card, a credit card that is designed to help people with a poor credit history rebuild and strengthen their credit rating may be more suitable, like the Capital One Classic credit card or the Vanquis Visa credit card.

You can Compare bad credit rating credit cards here.

Knowing what's on offer...

In comparison to some credit card offers, low interest rate credit cards are fairly straightforward.

A low interest rate credit card offers a low rate of interest on outstanding balances that you carry over from month to month.

- Low purchase rates
Low interest rate credit cards primarily offer a low rate of interest on purchase balances. The purchase balance on your credit card is the balance resulting from paying for goods and services from retailers and companies.

Credit cards don't charge you a fee when you purchase goods or services in the U.K.

However, if you use your low interest rate credit card abroad you may be charged a foreign transaction fee on your purchases, or if you use your card on the Internet to buy goods or services from overseas in a foreign currency.

- Low cash transaction rates
If you are going to use a low interest rate credit card for cash transactions, then you should make sure the card also offers a low rate of interest on cash transactions.

Cash transactions include withdrawing cash from an ATM machine, getting 'cash back' at the supermarket, buying foreign currency or traveller's cheques and also gambling transactions, including any transaction made at a casino - even if you are just buying food or drinks.

Cash transactions made with a credit card can also carry handling fees. If you are going to use a low interest rate credit card for cash transactions you should choose a credit card with a low cash handling fee.

- Keeping it cheap
Low interest rate credit cards can offer more than just low interest rates to keep using the card cheap for cardholders.

Low interest rate credit cards often offer no annual fees, cheaper foreign transaction fees and cheaper or no cash handling fees.

Some low interest rate credit cards may also offer introductory rates on purchases, so you can save a little extra money when you first take out the card.

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