How To Fight the Increased Rate on Credit Card – 5 Steps

What to do when the interest rate on the credit card increases.

Just because the interest on your credit card has increased does not mean that you were either forced to endorse the higher rate or risk losing the credit card. You’ll have other options available to you.

Opt out of the higher rate.

This is the first option that make to the mind of many people when they want to reject the higher rate of interest. This will be particularly to people who carried a balance from one month to another. A higher interest rate will make the maximum difference the people involved their balance. Rejecting the higher interest rate by opting out will allow you to pay your current balance at the lower rate of interest. However your creditor will probably close your credit card account which could result in a negative impact on your score, especially if the creditor closes on the credit account before you had the chance to pay off the balance.

Credit card interest rate

Negotiate a lower rate.

You can always call of the creditor and try negotiating a lower interest on the credit card. Sometimes a creditor may increase the credit card interest rate in spite of you had a positive credit history with the creditor. In this case you may be able to speak to the creditor and have them revert to a better rate of interest. If the rate increase is due to a delinquency of late payment on your part you may not be able to negotiate a lower rate of interest. However, if the late payment is just a one-time slipup in a history of otherwise timely payment, your creditor may be willing to make an exception for this one occasion.

Pay off the current balance fast.

You can decide to keep the credit card with the higher rate of interest by paying off the current balance quickly till the current lower rate of interest is active. After that once the new higher rate of interest into effect you can continue to charge your credit card as usual but pay down the balance in full at the end of every month. Interest rates only affect those people who reward the balance from one month on other. As long as you pay down the balance in at the end of the billing cycle you will not have to pay any interest and the interest rate would make a difference to you.

Transferring balances.

People also transfer the balance of one credit card to another but the interest rate on credit cards in a high. Just make sure that the credit card you can spend balance to has a high enough credit limit and does not make the balance on the credit card close to or over the credit limit as that could hurt your credit utilization which would in turn have a bad effect on your credit score.

When nothing else works.

If nothing else works free within you may just decide to keep the credit card and pay off the balance at the higher rate of interest is to even be faced with a situation where you do not have any other credit card or other credit cards are maxed out paying a slightly larger sum of money on the current balance may be worth it to keep the credit utilization ratio in place and not damage to your credit rating. You can either decide to stop charging the credit card so much from the next billing cycle onwards or decide to pay your balance down in full so that’s the high interest rate will not affect you so much.

The federal law also requires the credit card issuers to review the credit history of a person and determine whether the previous increase in the interest rate is applicable in the consumer in the current situation are not. This means that if you continue to make only payments on time and your payment history stays positive the credit card issuer may decrease your interest rate after 6 to 12 months.

Leave a Reply