How do I lower my credit card interest rates?

Do you know how much your interest rates affect your monthly credit card balance? If not, consider this scenario. Imagine for a moment that you have a credit card with a balance of $500 on it, with an interest rate of 14%, and you make the minimum pay of $15 a month on that card. Without any additional fees, and without making any other charges to the card, you will pay a total of $637 to pay off the credit card and it will take you three years and seven months to do it.

Now, imagine if you can get a better interest rate, perhaps around 10%, with the same amount owed on your card and the same monthly payment of $15; you can reduce the amount of time it takes to pay off your card by three months and reduce the amount of money you owe $49. This will add up fast if you continue to use the card or if you have multiple credit cards with the same scenario.

With that in mind, you may be wondering just how you can get lower interest rates on your credit cards. If you are, you will be happy to know that you do have a couple of options available to you.

How to Get Lower Rates from Your Credit Card Company

Okay, this may seem a bit simplistic, but the easiest and fastest way to lower your credit card interest rates is by calling your credit card company and asking them. Now, it is important to realize that if you do not have a good credit history with your credit card company, this tactic will not work. Your credit card company will only want to increase your rates if they see you as a risk; so if you have missed your last payment, you probably will not have much luck if you call them for a reduced rate. However, if you are a good customer, who consistently uses your credit card and always pays your bill on time, your insurance company should not have any problem getting the credit card company to change your interest rate to a lower one.

With that being said, many credit card companies are not willing to lower their rates because of the bad economy. Some credit card companies are taking steps to increase rates while they have the chance because new laws going into effect next year will prevent them from increasing fixed rates without specific, proven cause. Many credit card customers with years of good standing with their credit card companies are finding themselves surprised with an increased rate rather than a decreased one. If you are one of those individuals, you have two options.

Your first option is to play hardball with the credit card company. If you are a credit card holder in good standing with your credit card company, then you can actually demand that they lower your rate. While credit card companies want to ensure that they make a profit every year, most do recognize that if they lose their paying customers they will have a difficult time meeting their bottom line. As such, you can tell them that you will close your account with them and pay off your balance if they do not lower your rates. If they still refuse, then do what you promise.

That leads you to your second option. If you are a person with a good credit record and your current credit card company will not work with you regarding your insurance rates, then it is time to move on. In a tough economy, many credit card companies are looking for individuals with a good or great credit score to present with a credit card, so leave that company that will not work with you and find one that will.

Make Sure You Understand What is Available to You

There are a couple of important things to consider when you are trying to get a lower interest rate. Firstly, you need to know what the going interest rates are and secondly you need to know what kind of rate you can get with your current credit score (click here for free credit score offers).

It will not do you any good to ask for a lower interest rate if you are already getting what the industry considers rock bottom rates. Your credit card company is not going to offer you anything lower than what they are allowed to, so you need to be reasonable. If you have an 8% interest rate and the industry standard is 10%, then you are probably in a much better place than you realize.

Also, if your credit score is terrible or, as mentioned before, you have a poor payment history then your credit card company will not feel the need (or desire) to lower your rates. You need to establish a strong payment history for about a year before you can expect lower interest rates to be applied to your account. This does not mean that you should not ask. It never hurts to ask; however, do not get upset if you cannot get what you want in this situation.

Your Other Options

You do have another option available to you if you want to ensure that you are getting the very best credit card interest rates and that is to let us “Chase” down the perfect card for you. If you have good credit, we can find cards with low introductory rates that will allow you to transfer your balance to the new card, often with very low rates that last up to a year. Then you can find another low introductory rate card that allows you to transfer you balance again, keeping your rates very low for several years. Often you can repeat this cycle many times, and we can continue to find the right balance transfer card or cards for you.

If you have bad credit, we can help you find a card too. While you may not have as many low interest rate credit card options available to you as someone with great credit, it is possible that we can find you a card that will provide you with a lower rate than you are currently receiving. The great thing is, we can find you the cards that meet your criteria and you can take them or leave them as you wish, with no obligation.

Our job is to find the right credit card for your situation, whether you need a credit card for your business or for personal reasons. Finding the perfect card can be difficult with so many choices and we take all of the guesswork out of the process. All you have to do is check off the things that you are looking for in a credit card on the credit card “Chaser”, and let the tool instantly show you the cards that meet those criteria. Get started finding the best credit cards today!