One 2009 study by the FINRA Foundation showed that about 41% of credit card holders pay substantial interest payments on their cards. If you’re in this percentage of credit card users, you may want to look at getting your credit card interest rate down.
Luckily, there are several things you can do to lower your credit card interest rate, some of them are surprisingly simple. Here are six tips to help you lower the interest rate on your credit card:
1. Call and ask
One of the simplest ways to lower your credit card interest rate is to ask your bank to knock your rate down. Often times, all it takes is you taking the initiative and asking your bank for a lower rate. If you call the customer service department, especially if you’re armed with information about average interest rates and your excellent credit score, you may be able to get your interest rate lowered on the spot.
If this doesn’t work the first time, keep trying. Sometimes you just need to get through to the right rep on the right day. (If your credit is less than stellar, though, you may need to follow some of these other steps before you call and ask again.)
2. Shop around for a balance transfer card
A credit card balance transfer can be a good way to get lower interest rates, particularly if you’re already carrying a high balance. When you’re shopping around for a card to transfer your balance to, make sure you understand not only your general interest rate and your introductory rate, if there is one, but also the balance transfer rate, which is often different from the overall interest rate for the card. If you aren’t sure exactly how much interest you’ll be paying on a balance transfer, call the card company to find out before you sign up for a new card.
3. Raise your credit score
If you’ve been denied an interest rate reduction and can’t find a good balance transfer card for your needs, you might need to raise your credit score. Credit card companies will rely heavily on your credit score to ensure that you are up to paying off your credit card purchases. If you’re risky, they’ll hike up your interest rate so that they’ll at least be guaranteed to get some money out of you.
By lowering your overall debt, making payments on time, and managing your credit cards well for a few months, you can add points to your credit score, which can deduct interest from your credit cards. Once your score has improved by several points, call your credit card company once more to ask about an interest reduction.
4. Lower your balances
If you’re carrying a very high balance on your credit card, that’s a sign to the credit card company that you may not pay your whole balance. Again, this signals to the company that they should take more in interest so that they can recoup their losses if you were to fail to make payments.
By paying down your balance, you can often negotiate for a lowered interest rate, too. The bonus here is that once your interest rates and your balances are down, you’ll be able to pay down your balance even faster, since a larger portion of each payment will go towards your balance rather than towards interest.
5. Have a good track record
If you’re constantly missing payments or turning them in late, you’ll probably see some serious interest rate hikes. Plus, you’ll take damage to your credit score. If you want a lower interest rate, be a good customer by making your payments on time and avoiding late fees and similar issues. Once you’ve made payments on time consistently for several months in a row, call the credit card company to ask for a lower rate.
6. Avoid scams
The Federal Trade Commission notes that there are many companies out there who will claim to lower your credit card interest rates for you by negotiating with your credit card company or by other means. These fraudulent companies will ask for your credit card information and up-front payment, which then opens you up to credit card fraud.
Lowering your credit card interest rate isn’t that difficult, and you can do it yourself. Never give out your credit card information to a company who claims to have a special relationship with your lending company that would allow them to lower your interest rate for you.
Lowering your credit card’s interest rate isn’t that difficult, as you can see. The goal is to prove that you can be responsible with your credit card, which will make your credit card issuer more likely to lower your rates for your card. Once you’ve shown yourself to be responsible, simply call and ask to have your rates lowered.
Daniela Baker is a personal finance blogger at CreditDonkey, a credit card comparison website. She is a mother of two and along with her team, she helps families make informed financial decisions about credit. Visit her blog and remember, you can always compare credit card deals if your current credit card issuer won’t lower your interest rate.











