When a credit card interest rate is “Prime +” some percentage, like 7.75%, what is my interest rate?

Last Updated: May 24, 2013 11:24PM UTC

Prime rate is the benchmark that other interest rates for loans, mortgages, lines of credit, and credit cards are based on. It is set by the Federal Reserve based on lending activity at 30 major banks around the world, and is published in the Wall Street Journal. ( You can also view the real-time prime rate online at sites like Bankrate).

For the past year, it has held steady at 3.25%, though it is always subject to change
. In the example above, the customer’s interest rate is actually 11%. (3.25% + 7.75%).

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