Credit card application, a new world
After a short period, usually just six months, it ends, and now you have to pay the credit card's real interest rate. The interest rate on a student credit card is typically a little higher than the rate for an older person's credit card, and is currently around 13 to 20 percent. Student default rates zoom up to 25 to 31 percent if your payment is even a day overdue. This change in interest rate is retroactive, meaning that even if you bought something when your interest rate was 0 percent, you will have to pay 13 percent (or 20 percent, or 31 percent) on it until your balance is paid off. If you let your interest compound, you can wind up paying two or three times as much as the original sticker price.