What is a penalty interest rate on a credit card?

In Wisconsin, a penalty interest rate is a higher interest rate that a credit card issuer can charge if a cardholder fails to make the minimum payment on their credit card. It is important to note that a penalty interest rate does not apply in all cases; it is only used if the cardholder fails to make the minimum payment on their credit card for two consecutive billing cycles. The penalty rate is usually higher than the standard interest rate that a credit card issuer charges and can vary from card to card. Generally, the penalty rate is at least 25% higher than the regular interest rate. Furthermore, some credit card issuers may also charge additional fees on top of the penalty rate if a cardholder fails to make the minimum payment on their credit card. In Wisconsin, it is important for people to understand the penalty interest rate associated with their credit card. Not only is it important to ensure that the minimum payment is made on time, but it is important to ensure that the payment is large enough to help pay down the principal balance on the card so that it can be paid off faster. Additionally, if people are unable to make the minimum payment on the card, they should contact the credit card issuer or bank to avoid incurring high penalty rates and fees.

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What is a penalty interest rate on a credit card?

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