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Some Variable Rates Only Go Up
Most credit cards currently carry variable interest rates. And while the term "variable" seems to suggest that an interest rate could vary up or down depending upon the movement of the index to which it's attached, that's not always the case.
It's actually becoming more common these days for credit issuers to use something called a Variable Rate Floor to make sure your interest rate will only go one direction from where it starts—up. This doesn't mean the rate won't fluctuate up or down once it rises above the starting value, but the rate floor does prevent it from ever dropping below where it began.
According to the Center for Responsible Lending, variable rate floors were practically nonexistent five years ago. In fact, their analysis shows that while none of the top eight major credit issuers used this practice in 2005, two of them now "commonly use a floor equal to the current purchase APR."
If your credit card has a variable rate floor and is tied to the prime rate, it's likely already hit that floor. So be prepared for your rate to only vary its way up as the prime rate eventually moves away from record lows.
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