Q: Why do credit card issuers jack-up APRs if your credit score dips or you miss a payment to another creditor?
A: Higher interest rates go hand-in-hand with higher risk and they provide motivation for cardholders to pay-off their higher APR balances first. Card issuers hate to take a loss on any credit card account so if they see you are having financial trouble they want to send you the message to pay-up and go elsewhere. While it may seem unfair to penalize you in this manner it is permitted under current federal regulations.
