The average new credit card interest rate is now 14.72%. Although, credit cards marketed to those with bad credit can top out at 59.9% interest.

Congress passed the CARD act to combat fees that credit card companies can charge, unfortunately capping interest rates was not part of that package. Banks may not retroactively raise customer rates, but that does not stop them from raising rates for new customers applying for a new card.

According to credit card expert Beverly Harzog, the banks are making initial interest rates high right now because they know they cannot raise them down the line. They need to protect their bottom line.

The past 2 years has seen record increases to APRs which have gone up 20% and then some. There are some proposals in congress right now that attempt to cap credit card interest, including one from Maurice Hinchey a NY Congressman. So far nothing has been passed into law.

Beverly Harzog recommends that those wanting to improve credit start with a secured card. This is essentially a pre-paid credit card, but will still get reported to the credit agencies, thus building a credit history. This is essential to people who want to have hopes of getting a decent rate in the future. Orchard Bank was mentioned by Harzog as having such a card.

February is proving to be possibly one of the best months of 2011 for balance transfers. This is because Discover is offering two limited time promotions for the month of February. The first offer, which is a no balance transfer fee card, is 0% interest for 12 months on balance transfers and purchases. This is probably one of the best deal for consumers and many are taking advantage.

Discover is also offering a 24-month interest free balance transfer. This card, however, requires a 5% balance transfer fee. This may be the best option for consumers who will require more time to pay off their balances.

Consumers can get 0% interest for 18 months with a 3% balance transfer fee by using the Cit Platinum Select Card.

Many credit card companies, including Bank of America, are making competition fierce. However, Discover’s two limited time offers, which expire in February, are the main reason the balance transfer market is so strong for the month of February. If you were to take the offers from Discover and Citibank out of the equation, you would see that the overall market for balance transfers is surprisingly weak. This is because the average balance transfer deal is only 9 months long which doesn’t give consumers the confidence that they can pay their balances within that time frame.

The Chase Slate credit card offers great balance transfer terms, up to 18 months. However, consumers with less than perfect credit may only be offered 6 months to pay their balances. Those with perfect credit can expect the appealing 18 month terms.

Other banks such as Bank of America, Wells Fargo and U.S. Bank also offer balance transfer deals. However, these are usually unpopular due to the short terms, some lasting only 9 months to pay balance transfers. Transfer fees are also relatively high for these banks making these offers less appealing to consumers.