Entry

How do i keep my credit card at a low interest rate

Jan 9th, 2008 13:01
Ivan Rimsky, Mark Gomelli, http://www.breadmarket.co.uk, http://www.cardfusion.com, http://www.creditcardmix.com

Credit cards are the most flexible form of borrowing. However, they 
tend to carry a higher risk of getting you further into debt.
- KEEPING A LOW INTEREST RATE -
Credit cards have a higher risk because interest rates are 
normally higher than other forms of borrowing. However, if one plans 
to borrow money for a short period of time credit card is the way to 
go. Getting a loan or a credit line will incur loan processing or 
originating fees.  If the credit card one uses does not have annual or 
transaction fees, borrowing money from the credit card will not cost 
him anything as long as he pays balance in full every month.
Credit cards are flexible because they allow you to pay off as much as 
you can whenever you can. To keep the interest rate low and to improve 
your credit score you must pay at least the minimum amount due within 
the grace period provided by the card.   
- GETTING A LOWER INTEREST RATE -
The best known way to avoid high interest rates is to transfer the 
balance and take advantage of the 0% balance tranfer that 
credit card issuers offer to new customers. However, you needn't keep 
transfering from 
issuer to issuer to keep your interest rate low. An easier way is to 
negotiate with your current credit card issuer:
If you have a fairly good record of making payments on time then try 
the following steps;
1. Ring your credit card company and tell them you are considering 
transferring your balance to another company. 
2. Tell them about the offers you've seen else where.
3. Finally tell them that you are willing to stay with them if they 
can lower the interest rate that you are currently paying on your card.
You'll find that in most cases, they are willing to lower the interest 
rate in order to keep you. 
Note:
1. If you have a good credit rating, thats another point in your 
favour; your credit card issuer would know how easy it is for you to 
be accepted by a competitor.
2. Your credit rating depends on 5 different factors.  The main two 
that will make up around 65% of your credit score are Amounts Owed and 
Payment History.  Keep your balances under 30% of your total credit 
line and make payments on time.  This will help to maintain a healthy 
credit history and will help to get low interest on the next credit 
card you will apply for.