Like any other institutions, financial companies are there to make money and will do so even if it means placing their credit card interest rates at the highest mark possible. But, in order to retain their customers, they are always willing to renegotiate and lower the interest. However, not many people think this is possible. Hence, they continue to be burdened by credit card fees month in month out. Luckily, I have some tips that might help to ease your credit card interest rate burden. Here is how;
Before considering all other options, you should first try to negotiate for a lower interest rate. This is the easiest way to reduce interest rates on your credit card. Banks will be willing to lower their interest rates because they do not want to lose you. However, they only negotiate if they have good reason to. Therefore, in as much as you are trying to get the most from your bank, also ensure that they are happy with you as their customer.
Work on Your Credit Score
Working on your credit score is one of the most effective negotiation tools for lower interest rates on cards. First, get your credit report from any of the credit reporting institutions. Identify key areas that are contributing to your poor credit score. From there, you will know what needs to be done. Of course, repaying your debts promptly is the fastest way to raise your credit score. However, if you do not have the lump sum now, you can always seek the services of a credit score repair professional. They will provide you with tips on how to make your score better.
Consider a Balance Transfer
If you have tried negotiating for a lower credit card interest rate to no avail, you should probably consider making a balance transfer. Most banks headhunt clients by making balance transfers offers of a 0% introductory rate. But remember that this introductory rate is only applicable for a period. Therefore, you make the most out of. Ensure that before the 0% introductory rate lapses, you have repaid all your debt or most of it. Also, before you migrate to another credit card, check their rates after the introductory offer. This will help you get the best balance transfer offer.
Loyalty pays. If you have been loyal to your bank, your bank will go out of its way to make you continue using their services, according to Balance Transfers. Therefore, it is worth sticking to one bank for it will come to pay. However, being a client for a long time is not just enough. You have to have always paid your debts in time. This will get you a review for the interest rate placed on your credit card.
Talk to Other Customers
Find out the rate being charged on other customers. You might be surprised that someone who got their credit card the same period as you is actually paying less. The difference in the rates might be a point something, but this money accumulates to hefty costs within no time.
Avoid Exceeding the Credit Limit
The credit limit is usually placed at 35%. Exceeding this credit limit could harm your credit score leading to increasing your credit card interest rate.
Timely Balance Payments
Always ensure that your balance is paid in time. Otherwise, you credit card fees will skyrocket within no time.
Prioritize Paying High-Interest Debts First
If you notice that you are incurring a lot in terms of credit card bills, consider paying your high-interest debts first and fast. Repay them as fast as you can so that you can start working on the low-interest debts. If you do not have the money now, you can sell some of the items in your house that you don’t need or start working a double shift to make more money.
Getting your credit card interest lowered does not just overnight. You have to be willing to try other ways if one fails. And, although you might get a small reduction, in the long run, it will be worth the effort.