How to minimize credit card interest rates

The fact is that credit card companies can raise your interest rates for almost any reason, or (as one contract states) “for no reason at all.” In one of the more egregious cases I saw a woman was asked if she wanted to increase her line of credit and when she said yes, they raised her interest rate 5 points becomes she was not longer a good credit risk with so much borrowing capacity outstanding.

You have several ways to fight back. One is simply to call your credit card company and threaten to pay off the balance and move. Sometimes, this works.

Some people use those “no interest for x months on balance transfers” offers to keep their rates low. It requires frequent shifting of credit cards (and you should cancel the old ones to avoid damage to your credit rating), but if you can keep up with the work, it will significantly lower your interest.

A third way to keep the rates low is to look for banks issuing cards with low rates. “Consumer Reports” magazine from Consumers Union does a survey and keeps a list. The variability in rates is quite large. And if you do not want to subscribe to their service, you can check around the web for lower rates.

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