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The interest rate you pay on your credit card depends on many factors. Your credit score will determine what types of cards you are eligible for. However, there are some ways you can control how much interest you pay for the right to use a credit card. What are the easiest ways to to lower your interest rate?
Tip 1: Transfer Your Balance To Another Card Transferring your balance to a new card can lower the interest rate you pay for credit. This is because you can choose the card that you would like to use. Someone who is paying more than 10 percent interest on a credit card is paying way too much. Searching the Internet will reveal the best offers for anyone looking for a deal. You might even be lucky enough to find a credit card that has an introductory rate of zero percent. Paying off your bills is much easier when no interest is attached. Keep in mind that a balance transfer may come with a fee. Be sure to take this fee into account when deciding which card is best for your. Consider looking into a card with no balance transfer fee to maximize your savings.
Tip 2: Consolidate Your Debt
Debt consolidation allows you to lower your interest rate by putting all of your balances on one credit card. This eliminates the interest on the cards you are no longer using. One interest payment on your debt is going to be less than paying interest on all your balances separately. Consolidating your debt may also allow you to pay less interest on your debt. Carrying a lower balance is going to result in less interest being charged each month. Paying your bill in full eliminates the need to pay any interest at all.
Tip 3: Go To Credit Counseling
Debt relief may be something you want to look into. Debt relief services will talk to your creditors on your behalf. Creditors may be willing to lower your interest rate as part of a debt settlement. It will make your payments more manageable each month. Lowering the amount of debt you have will also help you increase your credit score. Borrowers with a higher credit score will generally have the luxury of a lower interest rate on their credit cards. You should be able to gain access to credit at a lower interest rate as you get rid of your debt. Failing to take action to deal with your outstanding debt could result in having limited access to credit cards in the future. You have several options to lower the amount of interest you will pay when you use your credit card. Switching credit cards, negotiating with creditors and looking into debt relief services can all lower the interest rate you pay. However, you should really be making a plan to get rid of your debt for as long as possible. Having too much debt of any kind is not a good financial strategy. Take steps now to ensure that you will always have access to low interest loans.
About the author: James has a graduate degree in finance and writes about ways to save money on your credit.