If only all credit cards were low rate credit cards. While the best way to manage credit is to pay off balances each and every month, such strategy isn’t always realistic. This being said, if you are subject to monthly payments, you can at least try and lessen the finance charges incurred by being proactive.
One way to do so is to transfer your current balance to a new card, one with a lower rate. Another way is to simply call your credit-card issuer and ask if your current rate can be reduced. Don’t be surprised if you get your wish.
Indeed, credit cards with high interest rates can be transformed into low rate credit cards with a simple phone call. The reason why - the bottom line - is that credit cards are a business and as with any business, success is based on customers, revenue, and retention.
Given the competition in the credit card industry, it’s not surprising that companies are willing to do a lot to keep their current customers, especially customers in good-standing. If by lowering your current rate, the company gets to keep your business, then 6 times of 10, they’ll do just that.
Thus, even though it may seem like you’re in the weaker position because you’re making the request, in fact, you have the upper-hand. Your business is a bargaining chip and if you call your credit card company and let them know that you’re considering competing offers, then the chances are better than good that you’ll get their attention, as well as an offer to stay.
Low rate credit cards are quite common and be secure in the knowing that if your current card company says no, you truly do have other options to consider. In order to compete, many low-interest credit cards offer 0% APR on balance transfers, plus other perks. If switching cards can get your balance linked to a lower interest rate and thereby finance charge, then definitely consider doing so. However first give your current company the chance to match the offer.
How to do this? Call them. A five-minute conversation could see your current rate cut in half or even, reduced to zero for a few months (followed by a lowered overall rate). For many cardholders, especially those with high balances, monthly minimums are simply accepted without question. But, if you’re being charged an exorbitant penalty fee three times that of another card, you should know. Look over your statement and don’t be afraid to question what seems unfair.
When you call to inquire about low rate credit cards, be firm. Let the representative know that you will indeed take your business elsewhere if they cannot help. Also, be prepared. Do some research prior to calling so that when asked, you can return real numbers to support your case.
For example, if your current interest rate is 20%, let the representative know that you’ve seen similar low rate credit cards with a 0% balance transfer fee, as well as a 10% fixed rate. By quoting an offer, you could very well restructure your own.
In short, if you carry a balance, try and get the lowest rate you can so that you’re not only paying the minimum each month. (If you are, you’ll never make a dent in your debt.) However, don’t expect your credit-card company to suggest the lower rate themselves. It’s up to you to be proactive and try and secure the best deal possible. Oftentimes, cardholders feel they’re locked into a rate. Not so. And a call to your card’s customer-service center may be all it takes.
Tip: If at first you don’t succeed, try again. While it’s true that you must be prepared to walk if your card company won’t budge, don’t do so on your first attempt. Try and call at another time, as you may get a representative more willing to retain your business. If all else fails, try and speak to a supervisor and really present your case with authority.
