What Would a 10 Percent Credit Card Interest Rate Cap Mean for You?
When you first got a credit card, swiping the card at a retail store or restaurant or entering your credit card information in a phone app to make a purchase felt like a thrill, but that was a long time ago. Once you saw how quickly the balances would climb up, you made it your goal to make as few purchases on your credit card as possible, while paying more than the minimum payment toward your balance, so that from one month to the next, your credit card debt balance would get lower instead of higher. If your credit card maxes out every month once the credit card company assesses the new month’s interest charges, join the club. A lower interest rate on your credit card would lessen the burden. Perhaps you have considered a balance transfer with an interest-free grace period, or perhaps you have even done it and paid down your credit card debt substantially, only for the balances to creep back up once you suffered another financial setback. A new bill in the Senate could cap the interest rate for credit cards, but before you start celebrating, contact a Miami debt lawyer.
Bipartisan Bill Would Limit Credit Card APR Cap to 10 Percent
When a bill in one of the houses of Congress has support from both major political parties, you know you should take notice. A bill introduced by Sen. Bernie Sanders, an Independent from Vermont who has previously sought the Democratic nomination for the presidency, and Sen. Josh Hawley, a Republican from Missouri, proposes to cap the annual percentage rate (APR) on credit cards at 10 percent. In January 2025, the average credit card APR was 24.26 percent. Both of the authors of the bill have previously introduced legislation that would limit credit card APR. In 2019, Sanders proposed limiting the APR to 15 percent, and in 2023, Hawley proposed limiting it to 18 percent, but neither of those bills got enough votes to pass.
Credit Card Affordability and Accessibility Is Not Just About the Interest Rate
If the new bill becomes law, and 10 percent APR becomes the new limit, this could be a doubled-edged sword for consumers. Financial products with lower interest rates are risky for lenders; this means that fewer consumers who applied for credit cards would get their applications approved. Without access to affordable credit, they would probably turn to riskier financial products, like “rent a bank” loans from online banks, or even the dreaded payday loans that proliferated before and during the last financial crisis. A credit card with a 24 percent APR is less expensive than a payday loan where the interest and fees can quickly add up until they exceed the principal of the loan.
Work With a Debt Lawyer About Credit Card Debt
A South Florida debt lawyer can help you find ways to stay out of trouble with credit cards and pay off your existing credit card debt. Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.
Source:
cnbc.com/2025/02/07/bill-would-cap-credit-card-interest-rates-at-10percent-what-it-means-for-you.html
