What You Can Do About Rising Credit Card Rates
Credit card companies can impose rate adjustments at any time they want and despite the changes with the credit CARD law, there is still no cap limit to rate increases. As a credit card holder, what can you do to protect yourself from high fees?
Avoid APR Charges
Cardholders can do much to avoid paying the incurring interest rate charges on their bill. If you will not carry a balance, you won’t have to worry about APR charges at all. Make it a point to plan your purchases before charging it on your credit. Will you be able to pay your full balance by the due date? If you are not sure, perhaps you may consider postponing the purchase or using cash instead.
Never Take Cash Advances
Most credit cards today allow its holders to take out cash advances. Nevertheless, it’s important to know that this particular transaction is not covered by the grace period so you are automatically charged with interest the moment you take out the cash from the ATM. Furthermore, the APR applied on cash advances is usually higher than the rate applied on new purchases or balance transfers. If you’re going to use this feature, you will surely end up paying more on interest rate fees.
Request for A Lower Rate
If you have a good payment record with your credit card company, you may consider this option. Requesting for a low rate can work on your favor if you are confident about your standing as a customer. Before negotiating your credit card rate, explore the market and see the current rate offers with other cards. Thus, you can say that you are thinking about switching to another card to enjoy a better deal.
When you’re ready, call up the customer service hotline of your credit card company and ask to speak with the supervisor or manager. If you try to negotiate with the customer service representative, you may be told that it is not possible. On the other hand, if you speak with someone who can make decisions, then you are more likely to get a positive response.
Look for a Better Credit Card
If you feel that the card you own charges an excessive rate and your request has been rejected, consider making a switch. If you do your research, you should be able to find a credit card that offers a reasonable deal. If you have good credit history, use it to your advantage. You should qualify for a good credit card in the market that matches your needs and lifestyle.
Take Charge!
The credit CARD law mandates all issuers to notify their customers about up-coming changes or rate increase 45 days in advance. This will give you sufficient time to decide whether you want to keep your card or cancel the account. Should you decide to cancel, make sure that you pay off all your existing charges first. You have the right to pay off these charges under the old interest rate. Ask your issuer to indicate in your report that the account was cancelled through the customer’s request.
