How can I lower my credit card's interest rate?

Question

I have the Citibank Platinum Dividend (not the Student version) card with a 18.99% interest. I think it is ridiculous to have a 18.99% APR. I have a great credit history although it is rather short (I am 21/student and started this card at age 18).

I have never been late and I always pay in full so it never really mattered to me. But I feel, after proving myself a responsible credit user for 3yrs, they should cut me some slack. My credit limit goes up every few months (almost $20,000 now) but the APR never goes down!

I called about it and they said there is nothing they can do now but call again in 2 weeks. This is the only request I've made in 3yrs. Should I just dump Citibank and go with another bank? I'm afraid my credit score would go down since this is my longest-running card.

Advice?

Answer 1

THEY ARE LYING!!!!!!! If you have no balance on the card, tell them that you are not interested in retaining them as a credit provider unless you get a MUCH lower APR...if the customer service rep seems like they are BSing you...ask for the "account retention department"...unless they have something better to tell you about. That is the last ditch effort to keep you as a client. They may offer you a extremely low transfer APR or much lower rate. remember...if you don't owe them $$, then the power is yours. Since you are willing to dump the card, then also remember that it can affect your credit in a bad way. You are judged on several areas...if you think you can keep the card and not use it, then it would be a great help to keep it...read up on the subject a bit more if you decide to cancel...and not in this forum...Best of luck.

Answer 2

If you pay your balance in full each month (a very good idea), the interest rate doesn't affect you at all. Instead, shop around for a good rewards card. The going rate is 1% cash back on most purchases, with extra (2% - 3%) on certain types of purchases which vary from one card to another. The interest rate is higher on rewards cards, but if you spend responsibly you never have to pay a dime of interest!

Once you find a card you like, you can just start using it and leave the other credit card account open. That way the older account will still be on your credit report.

Answer 3

You pay as much as possible every month from the outstanding amount. Never keep payments close to the minimum amount due.. Once your increased rate of payments becomes a steady pattern , you can ask the same company or other company to give you a line of credit which you can use for any emergencies, but continue with the enhanced payment. After a year, ask a Bank for a Loan to cover the remaining outstandings and pay off the credit card company. Thereafter , use the credit card only for convenience of not carrying cash, but not for credit.Settle the bills promptly and they will go on enhancing your limits. Never exhaust your limits and never default in the card payments hereafter. Slowly, but surely, buld up a savings pool to tide over emergencies like the loss of a job or an illness in the family,etc.

Answer 4

You are right, the best way to build your credit is to have an open credit account with a company for a long period of time.Many people fail to realize this. You might want to consider either getting a new card with a 0% transfer balance, or American Express has a program where you have to pay every month and they have no interest rate fee. If I was you I would keep the card I have, honestly a 18% rate is not that bad and since you pay every month I would not worry about it to much. As you get older though you should look for cards with rates around 10 to 13% especially if you have a good score.

Answer 5

If you just stop using the card it will not change your credit score. Apply for a new card with another bank/company, however, will. Every time you apply for credit with anyone, it drops your score.

If they are telling you to call again in two weeks, it seems like there is something they can do about it. I sounds to me like they want to see if they can put you off. If you don't call back then they don't have to do anything. Call them again.

Also, you can request that they stop increasing your limit. That is what the credit beaus pick up when figuring your debt to income ratio. Even though you don't owe it now, you have it available to you.

Answer 6

call up the credit card company and ask them to lower the APR, tell them you have been a customer for so long and make payments in full, and all of that etc, tell them if they do not lower the it that you will close your account and you will go to another company to get a card in a lower APR, majority of the time it works, it did for me, it is worth a try at least, good luck

Answer 7

A lower interest rate, assuming that you are not paying in full each month, is more important than a few points on the credit rating.

Answer 8

Call and say you want to quit. You will get passed to a person designed to get you to stay. They, not the first operator, are the ones who can make that decision to lower your rate.

Otherwise, move cards. I have a Chase card that gives me 1% back on all purchases and 3% gas/groceries. I also don't have to call to get those rebates, they are applied to my next statement. I like that I have to take no actions and get money for doing business with them.

Answer 9

I highly suggest you read this article. I think you did the right thing by calling, and they should have worked with you on changing your rate.

Negotiate a Lower Credit-Card Rate
http://biz.yahoo.com/weekend/lowerrate_1.html

Answer 10

Call them again and tell them that if they are not willng to reduce your interest rate you will be cancelling your account. If they don't immediately comply then cancel it. It won't hurt your credit to do this. It will hurt your wallet not to! LOL Good luck and keep on being ontop of those finances!