How to Reduce an Interest Rate

A phone call can lead to a reduced interest rate.
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When you pay high interest rates, you're essentially tossing money to the wind that could go to savings or other necessities. If you have credit card debt but make your payments on time each month and have a good credit rating, you may be able to get a lower interest rate on your card simply by asking. Be careful about asking, though, if you have any credit problems. Creditors can look up your credit history when you request a lower rate, and if you have anything negative, you risk getting your limit lowered, according to Leslie McFadden of

Step 1

Research the average credit card interest rates of competing companies so that you know what sort of rate you are eligible for. If you have offers from other companies for much lower rates, or for zero percent balance transfers, keep those handy.

Step 2

Call the customer service department of your credit card company. You can find the number on your statement or on the back of your credit card.

Step 3

Tell the customer service representative that you are considering changing cards or transferring your balance if your current card is unable to provide you with a better rate. You can suggest a rate you'd like, such as 10 percent instead of 16 percent, or even 8 percent instead of 18 percent. Name a low rate, even if it seems unlikely that you'll get it, so that you give the company room to negotiate.

Step 4

Call again the next day if the customer service representative refuses to lower your rate. You can also ask for a supervisor if you meet resistance. Make it clear that you are very serious about switching card companies. If they still refuse, see if there is any steps you can take to get a reduction in the near future.

Step 5

Transfer your credit card balance to a new card with a lower or zero percent interest rate if your current card company simply won't lower your rate and you don't want to wait for your credit to improve. If the card has an introductory rate that will increase within a few months, make sure you are aware of the date and aim to pay off your balance by that time.

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