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Topic Composite Annual Percentage Rate
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By dtaylor
On 08/08/01
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A friend just opened a new Visa Acct through Wells Fargo Bank in Dallas, TX. On his 1st statement, it showed an APR of 18%, and also had "Composite Annual Percentage Rate 43.50%? This was his first statement. If he does not pay in full, what is the Composite APR? And will he actually be charged 43.5% of his unpaid balance?
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By The_Insider
On 08/17/01
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No! The "composite rate" on your friend's statement is a legal disclosure that annualizes any fees and finance charges that have been assessed to the account. It is NOT the APR of the account.
Example: If I took a cash advance and paid a transaction fee of $50, it would be calculated as a part the "composite rate" making is look higher than the normal APR. It is an effort to give consumers a truer picture of what they are actually paying. The effect though, is a lot of confusion. :)
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your questions are answered by the gromco team and card users like you
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