What is a solid APR?

The term solid APR means a fixed annual percentage rate. This term essentially means the amount of interest that will be charged during the year. Fixed APR is used with many different types of loans with credit cards. When lending money, it is important to know whether APR is solid or not.

There are two main types of annual percentage rates. The debtor could be charged a fixed APR or variable APR. The fixed APR provides the debtor a specified amount of interest during the year. For example, if a fixed APR is 5%, the debtor knows that he will pay exactly 5%next year.

with variable APR can fluctuate the interest rate. This means that the interest rate will be tied to the financial index and can move up and down depending on the conditions on the financial markets. Many times the APR variable will be tied to the main rate and will add some interest to it. When working with Variable APR, it can be difficult to determine how much interest will be charged during the year.

APR repair can be very desirable in lending money. As a debtor, loans or credit card payments will be much easier. The debtor knows exactly how much interest will be charged and fixed monthly payments will be submitted. This provides a certain consistency in the individual's budget and he or she will not be surprised by any payments.

Another advantage of a solid APR is that the debtor will not have to be exposed to changes in the market. With a variable APR, the debtor is at risk. If market interest rates increase, the individual's payment could increase significantly. This will not be a problem with a fixed interest rate. In the long run, the debtor is locked at a specific interest rate.

When working with credit cards, fixed interest rates will often be offered in advance. If an individual lacks a credit card payment, the rate could become a variable rate or may change to a higher fixed rate. This makes it very important to always make credit card payments on time, ABY has changed interest rates.