When it comes to credit cards, one of the most important factors to consider is the Annual Percentage Rate (APR). This is the cost you pay each year to borrow money, including fees and interest. Amazon offers several credit cards, each with its own APR, benefits, and features. Understanding the APR on these cards can help you decide which one is the best fit for you.
The APR on Amazon Credit Cards varies. For the Amazon Prime Visa Signature Card and Amazon Rewards Visa Signature Card, the APR ranges from 19.49% to 27.49%, depending on your creditworthiness. The Amazon Store Credit Card and Amazon Prime Store Card both have a regular APR of 29.99%. The APR for the Amazon Business Prime American Express Card and Amazon Business American Express Card varies based on the Prime Rate and your creditworthiness. These rates are variable and can change based on the market and the Prime Rate.
Understanding APR
The Annual Percentage Rate (APR) is the yearly cost of borrowing money from a lender, expressed as a percentage. It includes not only the interest rate but also any fees and other costs associated with the loan. The APR gives you a more complete picture of the true cost of borrowing than the interest rate alone.
APR on Different Amazon Credit Cards
Amazon offers several types of credit cards, each with different APRs. Here’s a quick rundown:
- Amazon Prime Visa Signature Card: This card is available to Amazon Prime members and has an APR that ranges from 19.49% to 27.49%, based on your creditworthiness.
- Amazon Rewards Visa Signature Card: Available to non-Prime customers, this card also has an APR that ranges from 19.49% to 27.49%.
- Amazon Store Credit Card: This card, issued by Synchrony Bank, has a regular APR of 29.99%.
- Amazon Prime Store Card: Also issued by Synchrony Bank, this card has a regular APR of 29.99%.
- Amazon Business Prime American Express Card: This card’s APR varies based on the Prime Rate and your creditworthiness.
- Amazon Business American Express Card: The APR for this card also varies based on the Prime Rate and your creditworthiness.
Remember, these rates are variable and can change based on the market and the Prime Rate.
Factors Influencing the APR
Several factors can influence the APR of an Amazon Credit Card:
- Credit Score: A higher credit score generally leads to a lower APR.
- Income Level: Higher income levels may lead to more favorable APRs.
- Credit Profile: Your payment history, debt levels, and recent credit inquiries can influence your APR.
- Type of Card: Different Amazon cards offer different APRs.
- Amazon Prime Membership: Some Amazon cards are only available to Prime members, which can influence the APR.
- Special Promotions: Amazon occasionally offers special promotions that can influence the APR.
The Impact of Missing a Payment
Missing a payment can have several consequences, including an increase in your APR, known as a penalty APR. If you’re more than 60 days late on a payment, your card APR may switch to the penalty APR, which can be significantly higher.
Changing APR Over Time
The APR on an Amazon Credit Card can change over time. It’s not fixed and can vary based on the market and the Prime Rate.
Conclusion
Understanding the APR on Amazon Credit Cards can help you make informed decisions about which card is right for you. It’s important to consider not only the rewards and benefits of each card but also the cost of carrying a balance. Always read the terms and conditions of each card carefully to understand the APR and other costs associated with the card.
Frequently Asked Questions
What is a variable APR?
A variable APR means that the interest rate on your credit card can change over time. It’s typically tied to a benchmark interest rate, such as the Prime Rate. If the Prime Rate goes up, your APR will likely also increase.
What is the Prime Rate?
The Prime Rate is a benchmark interest rate used by banks to set rates on many consumer loan products, such as credit cards or auto loans. It’s typically based on the federal funds rate, which is the rate banks charge each other for short-term loans.
What is the difference between the Amazon Prime Visa Signature Card and the Amazon Rewards Visa Signature Card?
The main difference between these two cards is that the Amazon Prime Visa Signature Card is available only to Amazon Prime members, while the Amazon Rewards Visa Signature Card is available to all customers. The Prime card offers more rewards, like 5% back at Amazon.com and Whole Foods Market, compared to the Rewards card, which offers 3% back at Amazon.com and Whole Foods Market.
What is a penalty APR?
A penalty APR is a higher interest rate that can be applied to your credit card if you miss a payment. It’s typically much higher than your regular APR and can be applied if you’re more than 60 days late on a payment.
Can I avoid paying interest on my Amazon Credit Card?
Yes, if you pay your balance in full each month by the due date, you can avoid paying interest on your Amazon Credit Card. This is known as the grace period. However, if you carry a balance from month to month, you’ll be charged interest based on your card’s APR.
