That plastic card in your wallet isn't the only thing flexible about your credit--your card's interest rate and annual fee are, too. Credit card offers range all across the board. That's great news for you as a consumer, because with a little effort you can get a better deal.
Things You'll Need
- Credit card
- Current credit rates
- Your credit score
- Phone number for card customer service
- Time to make a call
Find out which cards have lower rates than your current card. Call your credit card company and indicate that you are thinking of canceling your account and going with another card with a much lower rate. Ask for a rate that matches the other card.
Negotiate a reduction in your annual fee. Finance charges are not the only cost of holding a credit card. The annual fee can add up to much more than your monthly finance charges. Call your credit card company and negotiate hard to reduce or even eliminate this fee. Again, threatening to close your account usually gets their attention. Don't bother trying this with cards that are cobranded with airlines or hotels to offer rewards; these cards will never drop their fee.
Go to a site such as Bankrate.com to compare rates, but make sure you pay attention to all the details of the agreement. Note whether there is a grace period and how long it is; how long the introductory rate is in place; what the late fee is; whether the rate applies to new purchases, balance transfers, cash advances or only some transactions; and whether the introductory rate automatically increases if a payment is late.
Cite your history as a customer. If you've been with a card company for a while, play up your loyalty. Learn your FICO score (MyFICO.com) to know whether your credit rating is top-notch or not. (See <a href="http://www.ehow.com/how_110924_shop-mortgage.html" target="_top">How to Shop for a Mortgage</a> for more information.) If it is in great shape, you'll likely be able to secure a very low rate elsewhere-- and you should tell your current credit card company that.
Arrange for a balance transfer to your new card from your old card once you line up a better rate elsewhere. Read the fine print about balance transfer interest rates: They can often be higher than the interest on purchases.
Factor in the perks. Many cards that give added benefits, like airline miles or cash rebates, often charge annual fees and have higher interest rates. If you use your card substantially, these benefits add up and may be more valuable than the amount of the fees. Do the math to see if you come out ahead on benefits.
If you pay off your balance in any one month, forget interest rate and maximize other benefits. Let's face it, if you don't carry a balance, who cares what the rate is? Go for the added benefits like miles, loyalty points, cash rebates or low or no annual fees.