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Credit Card Interest Rates

yooperchick

Registered Member
My credit card was at a nice 7.9%. Then, it went up to 14.9% within a year. I have not made any late payments and when I called to inquire, they just said they now calculate the rates a little differently. Well, I wish I knew that before I racked up a balance. Now, a good portion of my payment is going towards finance charges and I feel like I'm stuck.

I can't get another credit card to play the "balance transfer" game cause of my balance on the one. Oh, and I even went to the bank to see if they'd give me a loan just to pay it off, then pay the bank back with the credit card so I can get a balance transfer rate of 0%. They didn't go for that.

Anyone else have any ideas of something I can do?
 

Mr_Snipes

Registered Member
They never tell you about the interest rate hikes, even if they know that they are going to do them. They want you rack up a balance so they can make more money off you and keep you paying them for a longer amount of time. My suggestion is to pay them off as quickly as possible. I personally went with a credit counsuling so that I could get the interest rates reduced and get them paid off. It helps. I have been using it for about 4 years and have about 2 more years to pay off my credit cards. Paying the minimum payment would have taken me around 32 years to pay off my credit cards if I never used them again.
 

yooperchick

Registered Member
I heard that credit counciling can show up on your credit report and doesn't look too attractive to lenders. Any truth to that?

I've looked a little bit at credit counciling, but there are so many companies out there. I've looked at a contract for one first hand and it looked fishy to me. I'm just so skeptical of scams. If I can find a "real" one, I think I could benefit from it.

How much lower did they get your interest rates?
 

Mr_Snipes

Registered Member
There probabably is some truth to them showing up on your credit report. Lenders probably will not like it, but at least you are trying to pay them off, without filing for bankruptcy.

Yes there are a lot of companies out there that do it. I started with Ameridebt, but because of their backruptcy they were forced to transfer all of their clients. So I was transferred to Money Management Inc. International. There are also local counciling agencies. It is all depends on your preference.

They lowered my interest rates to about 1/2 of what they had been. Some they reduced more than others depending on the creditor.

It can also depend on how much you owe in unsecured debt. Some of them require a minimum amount of unsecured dept. In my case, I owed around $10,000 in credit card debt.
 

Nanner

Registered Member
I know this has worked for others and might be worth a try. Call the CC company and tell them because of their high interest rate you plan on canceling their card and transfering the balance to a better rate card. Many will then offer you a lower rate. Worst case you wasted a phone call and are stuck with what you have now. Think you may have to be a bit firm about complaining but what the heck......

If you give it a try please let us know how it turns out.
 

yooperchick

Registered Member
I've tried the calling route - I didn't get anywhere. But, I didn't threaten to leave. Now, it would be an empty threat because my balance is too high to get another card to transfer to. But, it's worth a try, right? Now, I just have to be in the mood first. I'll keep you posted...
 

Mr_Snipes

Registered Member
If you are having problems making the payments, explain that to them. If they still refuse, threaten to transfer you balances or threaten to go with a credit counseling agency so that you are not so straped for cash. That should get their attention. If it does not get their attention. Inform them that you will never use their card again ever. After I went with credit counseling, I received a letter from one of the creditors saying that did not appreciate it that I didn't call them first. I don't think they like credit counselling agencies, so letting them know that you are thinking about going to one because you are having problems making payments may make them think twice about saying no. Hope this helps.
 

softwarewiz

Registered Member
I'm still trying to get my first credit card (just out of school), but it seems logical that if you call them first, they're going to want to work something out with you.

I know a couple of people who have gone the credit counseling way and have paid as low as 10 cents on the dollar that they owed and I'm sure the credit card companies didn't like that one bit, but they kind of knew if they didn't agree, the person would likely file bankruptcy instead, so they figured a little is better than nothing. But those people's credit records are toast now for as long as 5 years I think (maybe 3 ... sorry, can't remember).

I'd give them a call, ask to talk to a supervisor so you don't waste time trying to negotiate with someone who can't authorize anything, and let them know your situation and see if they'll lower the interest rate if they know you are considering credit counseling.

I'm just getting into this stuff, so I'd really be interested on how this works out for you. Good luck. Makes me wonder if I really want a credit card after all :(
 

Mirage

Secret Agent
Staff member
V.I.P.
Well there's nothing wrong with getting a credit card. It can help you in many areas of life.....

The problem comes in when you overbuy and can't make your payments.

That being said, there is DEFINITELY nothing wrong with NOT having a credit card. You get props from me for being able to do that. :nod:
 
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