How to get Lower
interest rates on Credit Cards
January 4th, 2006
|
 |
|
Shop for lower
rates |
|
In order to make
your credit card payments count as much as possible and to get out
of debt sooner, you can try to get lower interest rates. Sometimes
card companies will offer a promotional balance transfer that is
1.99% for a six month period of time. Duration of the promotion and
interest rates can vary greatly.
Don’t assume that
every offer from the same credit card company is the same deal. The
card companies will mail you an offer with different rates on the
same advertisement. Some at full interest rates, mixed in with the
lower rates. If you decide to use the checks that they mail you,
you might use the wrong one and get the higher interest rates. If
you call in for a promotional offer make sure you take notes of the
day you called the rate, duration of the promotion, and who you
helped you on the phone. It is extremely important to read the fine
print and ask questions about the balance transfer fees and time
limits.
If you have a
card with a balance already on it, don’t use it. Get a card without
a balance because if you don’t you will be still be paying a higher
interest rate. The payments go to the low interest transfer first
and the balance that existed already sits there adding up interest
every month. Call the credit card company to check your balance on
the card so that there are no charges on it at the time you do the
transfer.
There are also
offers for the life of the balance transfer that will lock you into
a fixed interest rate for the duration of the balance. The interest
rates will be higher, for instance the short term offer will be
1.99% and the fixed rate for the lifetime offer will be 3.99%. You
have to weigh out the benefits and the downfalls of both types of
offers. The short term offer can be good if you are diligent and
confident that the rates will be low in the future and you are
prepared to do another balance transfer or pay of the whole amount
in a short period of time. Usually the short term promotions have a
higher amount for the initial transfer fee. When shopping around
for a good balance transfer check to see what the minimum and
maximum balance transfer fee will be. The average is around $50
maximum; however some credit card companies will go up to $150 or
more, seldom is there no fee on these short term promotions. The
long term fixed rate until the balance is paid off will more often
have no balance transfer fee at all. This can make up for the
higher interest that you pay over the short term.
If you have
limited credit resources left you should try to get a fixed rate
promotional so that you can lock in a low interest rate for the
duration. It should be your goal to get the debt paid off as soon
as you possibly can. The lower the rate in the long run the sooner
you can pay off your debt.
Sometimes credit
card companies offer the low interest promotional and when you get
your first billing statement you may be in for a surprise that the
interest rate is not correct. It is extremely important to verify
that you got the correct interest rate on the statements. If it is
not correct call the company to get it corrected as soon as
possible. Always check your interest rates on every credit card
statement. If at any time a card rate goes up you will be aware of
the problem, and hopefully it will prompt you to shop around for a
better rate or contact the card company to lower the rate if
possible. Never pay your bill late on a balance transfer because
you will lose your low interest rate and default back to very high
rate of 19.99% (this interest rate varies too).
Having a good
credit score can help lower your interest rates. It is important
that you always pay your bills on time; this will help improve your
credit score. Paying more than the minimum balance is also another
good way to improve your credit score. If you have had bad interest
rates in the past because of late payments, you can lower your rates
by improving your credit score.
The goal is to
pay off the higher interest cards first and pay the minimums on the
lower interest cards. After time hopefully, the debt will decrease
and you will be on your way to erasing the credit card debt.
By
Nicole Wilson
Best Syndication Staff Writer
common keywords and misspellings: det
consulidate low rates intrest rate credit card debts promtion
balence transfer fees balance transfer |
