CC Interest Rate Dropped!

[Bob B.]

I'm currently paying off four credit cards. One of the cards has a balance $8,775, or just a smidge under half of my total credit card balance, which is $17,576. The rate on that card has been a crippling 12.9%. I've made payments on that card faithfully for nine months straight. I just learned that the CC company has dropped the rate to 8.9%! I know, I know, 8.9% is not exactly something to celebrate, but it sure beats 12.9%.

[creditcardfree]

That is always good news...less interest to the credit card companies!

[disneysteve]

That's great. Keep paying the same amount and you'll see that debt melt away.

[JoshuaHeckathorn]

Wow- that's great to hear. May I ask which credit issuer dropped the rate?

[crazyskunk82]

I've never heard of a credit card lowering their interest rate. Congrats! That will help you pay it off faster!

-Andy


Rise The Wiser - A blog about breaking free of debt and learning financial wisdom

[Bob B.]

DS - Actually I'm paying minimums on this card because I have another card with a smaller balance (~$2,400) but a higher rate (16.99%)

The card that had the rate dropped is issued from a small local credit union.

[disneysteve]

Originally Posted by crazyskunk82

I've never heard of a credit card lowering their interest rate.

Actually, that isn't unusual at all. Your rate is based on your credit worthiness, your FICO score, your payment history, etc. If your score goes up and you pay on time for a good stretch, they re-rate you and put you in a less risky group that gets a lower interest rate.

Originally Posted by Bob B.

DS - Actually I'm paying minimums on this card because I have another card with a smaller balance (~$2,400) but a higher rate (16.99%)

Makes sense. Snowball the money over there.

[JoshuaHeckathorn]

Originally Posted by Bob B.

The card that had the rate dropped is issued from a small local credit union.

Makes sense that it's a local credit union. The large national credit issuers have remained quite stingy when it comes to interest rate reductions, although we are starting to see some improvement lately.

Good luck getting the rest of your credit card debt paid off. It sounds like you've got a good strategy in place.

[scot184]

Good job...keep paying it down and try to transfer some of it (or all of it if possible) to a 0% APR credit card...then you'll really be able to get out of debt...

[Frugal]

I too am surprised that they lowered your interest rate~!