What is a penalty APR?

A penalty APR, also known as a default rate, is a higher interest rate that applies when a credit card holder fails to make minimum payments on time. In Hawaii, if a cardholder fails to make minimum payments for two consecutive billing cycles, the penalty APR will be applied. The penalty APR can be significantly higher than the standard APR. It may also be permanently applied to the cardholder’s account, and could remain in effect until the cardholder pays off the balance in full. Additionally, a penalty APR can make it difficult for cardholders to pay off their existing debt. This is because the higher interest rates can make it much more expensive to pay off the balance on the card. In Hawaii, cardholders may be eligible for lower APRs in certain circumstances. For example, if a cardholder has a good payment history and pays their balance in full each month, they may be eligible for a lower interest rate. It is important for Hawaii credit cardholders to understand the penalties they can face if they fail to make payments on time. They should also understand the different APR options that may be available to them depending on their payment history. By understanding the consequences of late payments and the APR options available, cardholders can make informed decisions and ensure they are not paying more than necessary in interest and fees.

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What is a penalty APR?

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