With interest rates dropping now is the time to find a great deal on a low credit card APR. Why settle for paying 19% or higher when with a little effort you might be able to find a card that will charge you less?

All credit card offers will come complete with a list of features that are supposedly exclusive to that card. In actuality, most of the cards offer about the same set of features with a slight variation. All will mention the APR and knowing what and how that works is vital.

APR stands for "Annual Percentage Rate". It is the amount of money that you will pay, expressed as a percentage, for the privilege of charging purchases and carrying a balance.

The All Important APR

This is a biggie. The APR can drastically change your ability to pay off your card, particularly if you carry a balance. The APR attached to the credit card can vary not just from card to card but also from how and what you purchase.

For example, the APR for a cash advance is usually higher than for a purchase. APR's can also vary according to how much of a balance you carry on your card. These are called tired APR's because the APR depends upon which balance tier you are at on any given month.

For example, a balance of $0-$2,000 may be subject to an APR of 14% while a balance of more than $2,000 has an interest rate of 18%. Again, it pays to keep your balance lower on these types of cards.

Then there's the penalty APR. This happens when you make late payments regularly (meaning more than once in credit card lingo). Your APR can be raised and will affect your entire balance. Moral: Make your payments on time.

The most popular marketing tool used today by the card companies is the introductory APR. This is a significantly lower interest rate on transferred balances and purchases made during the said introductory period.

This is beneficial if you carry a high balance on another card at a high APR and can transfer your balance, giving you the opportunity to put more of a dent in that balance during the intro period.

One thing to look out for, though, is the future APR (or delayed APR) that kicks in when the lower rate expires. This rate can be significantly higher than the intro rate they are offering.

So remember, pay attention to the APR and know what rate will come into play for the card you are looking at. Make your choice wisely and be cautious!