Understanding APR
Debt Consolidation America is a part of a larger unit of non-profit debt help professionals. As such we are also committed to not only provide you with debt solutions but to educate you about financial matters. The better your understanding of how credit works the less likely you will be to find yourself in this type of a situation again. To meet this goal we have prepared a guide to give you a better understanding of the nature of APR or annual percentage rate, as it were.

What is an APR?
We have heard this term since we were old enough to watch a commercial, but how many know exactly what is and more importantly how it works. The APR is simply the cost you pay for credit. The APR is generally calculated yearly and this is how it is presented to consumers.

Before applying for a credit card you should compare the APR from several different credit card companies. This is to determine which card is best for your financial situation. By shopping around you get the best rate, and you avoid getting a card with an interest rate that could bankrupt you.
It is your money; it is your responsibility to use it in the wisest way possible. When you apply for a credit card and get accepted you are essentially making a pledge (read contract) to the lender that you will be responsible and pay your bills on time.

Calculating the APR 
When you calculate the monthly all you have to do is to divide the APR by 12. If you have a credit card with a 22% APR you pay 1.8% interest on a monthly basis. Look at it in these terms if your bill is 2500.00, multiply that by 1.8% you will see the amount of interest you are being charged on this balance. The amount in this example is 70.00 in interest you’re your minimum monthly payment is 85.00 then 70.00 of that is going toward interest and only 15.00 toward the 2500.00 principle. At this rate you will be paying off this debt for the rest of your life, or so it will seem.

As you can see by this example, paying only the minimum will not do. You have to pay enough to start to bring down the principle. Even if you have to sacrifice to make double payments until the balance is paid off, or at least the interest amount is lowered, this happens when the principal is less, you come out a winner.

Now that you have this information you can look at each credit card and calculate for yourself what the interest is and how much above the minimum you need to pay to get the principal down to a more manageable size. Contacting a professional like the ones here at Debt Consolidated America, will get you there even faster. We pride ourselves on getting you the best possible deals and sometimes we can even get a better APR for you so that you can get out of debt faster.