The Freedom From Debt Blog

One simple fact that many people do not realize is that, with the way most credit card company’s calculate minimum payments now, there is a direct link between your interest rate, or APR, and your monthly minimum payment.  In other words, a higher interest rate usually means a higher monthly payment, while a lower interest rate can mean a lower monthly payment.

Do You Know What Your Interest Rates are?

Unfortunately, many people do not even know what the interest rate on their credit cards are.  If you are unsure of what your rate is, check your statement for the APR.  You may be surprised by what you see.

Many people have their interest rate raised and do not even realize it.  Credit card companies can raise your rates for any number of reasons, so it is important to keep an eye on this.  Many people will notice the higher monthly payments, but do not realize the reason behind it.

Lower Your Credit Card Interest

So, how can you get more affordable payments on your credit cards?  One way is to lower your interest rates. There are a couple different ways to lower your interest, depending on what kind of credit you have.

If you have good credit:

• Simply call your creditors and ask for a lower interest rate. This may sound hard to believe, but it is true.  If your credit is good enough to qualify for a better rate, you may just need to call and ask.  Most companies will not automatically lower your interest just because you are deserving, because that would cost them money!  So if you have good credit and high APR’s, call your creditors now.
• Consolidate your debt with a lower interest loan.  You may also be able to transfer your balances to a lower rate card, but beware of transaction fees and teaser rates that will expire.

What if you have bad credit?

If your credit is not good, you will probably not be able to ask for lower interest or get a low rate loan to consolidate.  However, you do still have options.

Speaking to a reputable credit counseling agency and enrolling in a debt management plan could be your answer.  A debt management plan could get you lower interest rates, eliminate fees, and help you eliminate credit card debt fast.

Related Posts:
Credit Cards Raising Interest Rates, Payments
Even Congressmen Face Credit Card Debt
Credit Card Tips – 8 Tips For Using Your Credit Wisely