How to Reduce Your Interest With Credit Card Companies
Credit card companies earn much of their profit by charging interest on the balance that you carry on your credit card. For example, if your interest rate is 18 percent and your card has $5,000 on it, you pay $75 per month in interest, just for the privilege of continuing to borrow that money. Lower your interest rate to save money on your credit card payments. One phone call can reduce your interest rate, especially if you are already paying interest charges and the credit card company knows you might transfer the balance to a lower-rate card.
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Instructions
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Select a credit card on which you would like to reduce your interest rate. For the best chances of success, choose a card on which you carry a balance and have not had recent late payments.
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Look up the current interest rate on this credit card. It is printed on your monthly account statement or you can find it through your online account management.
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Research interest rates that other credit card companies are offering. You can find these on their websites or on credit card offers that you receive in the mail.
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Call the customer service phone number printed on the back of your credit card.
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Ask the customer service representative if he has the authority to reduce interest rates. If not, ask to speak to someone who does.
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Tell the customer service representative that you need to pay less interest and are considering transferring the balance to a lower-rate credit card unless the card issuer can help you out with your interest rate. Mention the interest rate on another card that you were researching and ask if your current credit card company can lower your rate.
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Thank the customer service representative if you get a rate change and ask for confirmation of the change in writing.
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Call again in a month or two if you did not succeed in reducing the interest rate during your first attempt. You could get a different customer service representative who is more willing to help.
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Tips & Warnings
Transfer the balance to a new credit card with a low introductory rate if your current credit card company will not lower your rate. If you do this, pay attention to the fees, which can be as much as 5 percent of the balance and make sure it still saves you money to transfer the balance.
Make more than the minimum monthly payment to save money on interest over time. If you end up transferring the balance to a lower-rate card, take advantage of this time with low interest rates to significantly reduce your debt so you don't have to pay much on interest when the rate goes up after the introductory period.
