Why Your Credit-Card Rate Might Not Be Falling

The prime rate looks set to keep falling following the Federal Reserve's latest rate cut. Since the consumer credit-card rates are in part measured by the prime rate, consumers might expect to see their rates fall as well.

But a number of common catches can keep your credit-card rate from falling with the prime rate.

Your credit card may have a "rate floor" that prevents your rate from falling below a certain level, your credit score may have changed causing your rate to skyrocket or your creditor may raise rates because of economic conditions.

About 90% of credit cards are variable rate, according to Curtis Arnold, founder of CardRatings.com. And most of these are tied to the prime rate as published in The Wall Street Journal plus a predetermined premium: a rate which has fallen three full percentage points since the Fed started slashing rates in September. ...