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Lower Your Credit Card Rate

Lower Your Credit Card Rate

© Money-Talk.org

Ask your credit card company to lower your rate, and surprisingly they just might.

Did you know one of the easiest ways to ease the interest rates on your credit cards is to simply call your credit card company and ask for a lower rate? It's true. You may be able to reduce your APR by many percentage points. You will need to be in good standing with your account for this technique to be effective, and the longer you've had your credit card account the more likely your chances of success. There really is no harm in trying. Creditors will do this because it is cheaper for them to lose some of your interest payments than to have to recruit a new customer.

A study done by the Massachusetts Public Interest Research Group found that 56% percent of participants were able to reduce their interest rate. Below is a summary of their findings...

Volunteers participating in the survey called their credit card company and asked for a lower APR. The results from a national spot survey of 50 consumers were the following:
  • With one 5-minute phone call, 56 percent of consumers who called their credit card company lowered their APRs.
  • Those who were successful reduced their APRs by an average of more than one-third, from an average of 16 percent to an average of 10.47 percent.
  • Three consumers were able to reduce their APRs by 15 points.
  • The survey results also showed a correlation between the cardholder's credit history and the likelihood of receiving a reduction in the APR. Factors affecting the caller's success rate were:
    • Length of time with a particular card (longer is better)
    • Credit limit on that card (a higher limit is better)
    • Unpaid balance-to-limit ratio on that card - how "maxed out" the cardholder is (a lower balance, making a lower ratio, is better)
    • Unpaid balance-to-limit ratio on all cards (a lower balance is better)
    • Number of times an individual missed or paid late on a loan or a card other than the one for which they were calling (fewer is better)

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