Regarding Bank of America, two third of American card holders have credit card debt in months. And some less experience users are sharing a dangerous idea of carrying the balance month to month to keep the credit active. You are charged interest on these credit card debt and making money to credit card companies. Yes! We are all in debt but I believe as wise consumers, you’d work hard in different strategies for a lower credit card interest.
Pay some more for your current balance
This is the most positive and direct way to lessen your debt as well as gaining some credit score. These two affect the interest you have to pay for the debt in various ways. Paying more regularly benefits you quickly clear the balance because the interest is calculated on your left balance and getting smaller step by step. In meantime, it also show to credit bureaus that you become a responsible borrower and rewards some credit score. The higher credit score the better chances to apply new alternative cards with lower credit card interest. These low APR credit cards can be used to transfer your balance in the debt management.
Related story: What is a good credit score rating?
Switch to 0% APR credit cards via hot contacts
0% APR credit cards are your golden stars in getting lower credit card interests. You can switch to new credit card companies having interest-free on balance transfer in 12 – 18 months. With a little fee, you can pay off the balance without any interest charged. In fact, 0% APR credit cards are mostly limited to special customers or high credit score profiles, and there is a chance that you’re not among of them. An efficient tip that I gave many friends is to ask your family members who got a good credit score (700 plus) applying a free-interest credit card. After that he/she shares 0% APR account authority to you and transfer the current debt to new card.
Related story: What is 0% APR credit card?
Call for a lower credit card interest
This sounds silly but it happened and got more efficiency than you may think. Actually, we are able to have a call with credit card companies and simply ask for a lower interest rate for your current card. But they don’t make a happy ending with everyone. The reasons for them to consider are normally good credit score and on-time payment in a long period (minimum payments are counted). You can create a story, which you will switch to another company who offers you a lower rate, to trigger their decision. The best practice reveals that this deal can be closed at supervising level, thus you shouldn’t spend time with the first person pick the call up and ask for a talk with a supervisor.
You can prepare a script for your talk such as my recommendation:
Hello, my name is____. I have been using your credit service for____ years and paying the rate at____%. I think this is not the best deal for me for my credit history as long as I recently received some offers with lower credit card interest rate. So I am calling to show my favor to keep our relationship, but if I can’t get a better rate, it’s hard for me to remain the account and not go with other credit card companies. Can you consider my request?
Update the avg. credit card interest rate
You’ll be charged by rate at the moment you opened this account. Therefore, if you know the average rate is lower than the current one, you can call to the issuers and ask for the rate as equal as the latest rate. According to Time.com, the fix-rate credit card interest rate was dropped from 13.1% in Jan 2016 to 12.52% after a couple months. Just a 0.58% lower rate but you can save more in months or years to handle the mission. Being in track in comparing rates will determine the best deal in the market.
Obviously, lower credit card interest is not a thing out of our hand, the most challenge would be to build a credit responsibility as a core solution. From there, you can apply all 3 tips above to quickly redeem your desired rate and clean the balance. And don’t forget spreading this post to your friends who need that 🙂