No Caps on Rates

• As of 2011, there are no caps on interest rates. Thus, creditors can charge whatever rate they feel appropriate. Many creditors raise rates if you are late on your credit card payment, so it is important to pay on time to avoid high interest rates. In some cases, creditors raise interest rates if you are late paying any of your other bills even if you pay your credit card bill on time.
  
  

Rate Rise Regulations

• Under credit card legislation passed in February 2010, creditors must provide written notice of rate increases at least 45 days before implementing an interest rate change. If a borrower is uncomfortable with new rates, he can opt out. Opting out means that he cannot use the credit card for new purchases, but has five years to repay his balance under the terms he agreed to before the creditor chose to raise rates.
  
  

Rate Locks

• Credit card companies must charge you the same APR for your first year of service, with the exception of promotional rates that are clearly offered for a limited period of time. If a credit card company offers a promotional rate, it must keep that rate for at least six months. When comparing APRs on different offers, compare the rates you will be paying after any promotional offers expire.
  
  

Variable Rates

• Some credit card companies offer variable APRs, which fluctuate based on economic indexes such as the U.S. Prime Rate. These APRs are not subject to regulations regarding changing the APR because they change on a regular basis rather than staying the same unless the creditor chooses to raise them. These rates may not exceed the rates set by the index the creditor bases its rates on.