A penalty APR is not the purchase APR

The purchase rate is the cost of carrying a balance. Penalty rates are a separate, higher schedule.

Published September 1, 2026

Personal finance editor

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Purchase APR applies to new purchases if you revolve a balance. Penalty APR, if the issuer uses one, is a different rate that can apply after a late payment or other trigger in the card agreement.

Cash-advance APR is often higher still, and interest can start immediately.

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