Seven plus 20.99 equals 27.99. That sum is the top variable rate on the Chase Freedom Unlimited card once prime is 7%, using the margin and formula printed on Chase’s own card page. The page itself still showed the older 6.75% prime when it was read on Sept. 29, so the 27.99% figure is arithmetic on Chase’s published recipe and not a rate the bank has posted.
The recipe printed on the Freedom Unlimited page
Chase’s Freedom Unlimited page gives the variable APR as a range, and shows the formula behind each end. The low end is written as the minimum of 6.75 plus 11.49 and 29.99%, which comes to 18.24%. The high end is the minimum of 6.75 plus 20.99 and 29.99%, which comes to 27.74%. The 6.75 is the prime rate that applied before September, the two added figures are Chase’s margins, and 29.99% is the ceiling.
The page also describes an introductory 0% APR for 15 months from account opening. That offer is separate from the variable range and does not use the prime formula while it lasts.
Swapping 6.75 for 7.00
The Federal Reserve’s H.15 release lists the bank prime loan rate at 7.00% for Sept. 21-25. U.S. Bank’s announcement says its prime rate rose from 6.75% effective Sept. 17. Nothing in Chase’s formula changes except that first number, so the arithmetic is direct:
- Low end: 7.00 plus 11.49 equals 18.49%, up from 18.24%.
- High end: 7.00 plus 20.99 equals 27.99%, up from 27.74%.
Each end of the range rises by 0.25 percentage point, the same amount as the change in prime. Both results sit under the 29.99% cap, so the ceiling does not alter either figure. The high end is 2.00 points short of it.
What is Chase’s number and what is derived
Only some of these numbers belong to Chase. The 11.49 and 20.99 margins, the 29.99% cap and the 6.75% prime displayed are printed on the card page. The 18.49% and 27.99% figures do not appear on any Chase page that was read for this report. They come from replacing the printed prime with the 7.00% in the Fed’s release, and they should be read as the result of that substitution.
The pages read here do not describe when a change in prime reaches an existing account. The card agreement is the document that answers that question, and it was not part of this report’s record. A cardholder wanting the exact date can find it in the agreement’s section on variable rates or by asking the issuer.
What 0.25 point does to a balance
On an average daily balance of $3,000, 0.25 percentage point is $7.50 over a year, or about 63 cents a month. Moving from 27.74% to 27.99% on that balance changes annual interest from about $832 to about $840, before compounding. The change is small in any one month and larger over the long stretches a balance can stay unpaid.
The rate a cardholder receives depends on the margin assigned at account opening, which is why Chase prints a range. A cardholder at the low end pays 18.49% and one at the high end pays 27.99%. The gap between them, 9.50 points, is larger than the whole increase in prime since the Fed’s September decision by a factor of 38.
Backing a margin out of a statement
The same formula works in reverse for a cardholder holding a statement. Subtracting the prime rate in effect from the purchase APR leaves the margin. As an illustration, an account printing 26.74% while prime was 6.75% carries a margin of 19.99 points, and the same account should print 26.99% at a 7.00% prime. The number is invented for the example and is not a Chase figure; the point is that a repriced account differs from the earlier one by exactly the change in prime, no more.
The Sapphire Preferred page follows the same pattern
Chase’s Sapphire Preferred page uses the same layout with different margins: 12.49 at the low end and 20.74 at the high end, capped at 29.99%. It displayed 19.24% to 27.49% on the 6.75% prime. The same substitution gives 19.49% to 27.74% at 7.00%. That card also lists a $95 annual fee, a cost unrelated to prime.
The Fed’s decision behind the swap
The Federal Open Market Committee’s Sept. 16 statement raised the target range for the federal funds rate by 1/4 percentage point, to 3-3/4 to 4 percent. Prime then rose by the same amount. Chase’s card pages carry that decision through a formula that adds a fixed margin to prime, which is why a 0.25-point move at the Fed shows up as exactly 0.25 point on both ends of the printed range.
Chase’s own pages supply every input except the 7.00 prime, which comes from the Fed’s H.15 table, and the arithmetic above is the entire path from the Fed’s September decision to the 27.99% top rate.
Debt collectors, frozen balances and where protections apply
The kit is written for households with card balances, loans or a bank account that a creditor might reach, who want the collection and deposit rules in one place. It addresses the difficulty of remembering which protections apply when a collector calls or an account is restricted.
The Bank Account & Debt Protection Kit is a 10-page kit that covers the debt-validation steps and the frozen-account response, with a protected-funds and dispute log for records.
Look up the debt-validation steps for a collector’s letter →
This article was drafted with AI help and checked against Chase’s card pages and the Federal Reserve data it links.
