How to lower your Credit Card Interest Rates
If you’re struggling with credit card debt, then you know how ridiculously expensive the interest on these cards can be. The average American has an interest rate of almost 15%, and a total balance of nearly $7,000. That means that a typical American could be paying over $800 a year in interest alone. If you’re in this situation, you need to take steps to reduce your interest rate.
The problem is figuring out how to get a credit card company to lower your rate. Generally speaking, most credit card issuers won’t lower rates simply because you want them to. Threatening to transfer your debt to another can work, but typically only if you have a better offer in hand. Of course, that also means you are responsible for paying balance transfer fees.
Instead of trying to juggle your high interest cards every month, you may want to consider a debt consolidation loan. These loans combine all of your credit cards into a single loan with a lower interest rate. In many cases, it’s possible to lower your interest rate by five points or more. These loans don’t rely on credit checks to determine your interest rate, so it’s possible to get a lower rate even if you have bad credit.
When you apply for a debt consolidation loan, you’ll work with a debt counselor who will review your income and expenses and find the best loan for you. Because of this individual attention, banks are willing to offer loans with lower interest rates than credit card companies that assign interest rates based on credit scores.
With a lower interest rate, you could see your payment drop by hundreds of dollars a month. If you need more help, your counselor can look for a loan with a longer payment period. These loans can lower your monthly payment by half or more.
<p data-sp-element=”content”>With a lower interest rate, not only will you be paying less every month, but you’ll also be paying less of your hard-earned money out in interest. That can mean that you’ll save thousands of dollars a year. If you’re having trouble making your payments right now, that money saved could be the difference between avoiding bankruptcy and getting your finances back in order.