Interest rate increase restrictions on credit cards are about to go into effect, thanks to new governmental standards. Before those restrictions occur, however, many card companies may begin increasing rates in an attempt to maximize their profits before the restrictions take hold. But there are several methods you can use to reduce your rates.
Instructions
How To Lower APR Rates On Credit Cards
- 1
Keep a low credit-to-limit ratio. For instance, if you have a card limit of $1,000 and you typically carry $200 a month on the card, you have a relatively low debt-to-limit ratio of 20 percent. Mention this to your card company. Users who are able to better manage their available balances show their card company they are a lower risk and, therefore, typically receive better interest rates.
2Request a balance increase before requesting a better interest rate. Many card companies want to see how their users can handle higher credits before they lower the rate. The principle behind this is simple: If you are responsible with a higher credit limit, you are less of a risk.
3Tell your credit card company that you have lower interest rates on cards you carry from other companies. Include information about your payment history, the credit limit you have and the debt-to-limit ratio of your card with that company.
4Ask for a lower rate regardless of your history. According to Bankrate, a significant number of credit card users saw an instant reduction in their interest rates by simply asking. Be persistent. If you don't receive the reduction on your first call, call back after a short period of time.
5As a last-ditch effort to find a better rate, find another card. Websites such as cardoffers.com and bankrate.com can help. Tell your current provider you will be changing to a new provider if they can't lower your rate. If they won't budge, sign up for the new card and call to cancel your old one.
Keep in mind that it's possible to find a card from the same provider with a lower rate.
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