If you have bad credit or if through a series of events your credit has suffered considerably, there is a good chance you have been subject to high interest rates on your credit cards. As your credit score lowers, your interest rates will rise due to the increase risk the lender takes on when lending you money. There are still steps you can take to even if your credit remains less than satisfactory.
There are several reasons that credit scores drop. There are several things that are seen as signs of financial weakness, such as nearing your credit limit, regularly transferring your debt from one card to another, closing older accounts, applying for several new lines of credit in a short period of time, and missing payments or making them late. These things may indicate a weakening financial position as indicated by a lowered credit score, which increases the potential that you may not pay off your debts. Interest rates will reflect the amount of risk involved, so they will increase as your credit score decreases.
Because of bad credit, you will be unable to receive leniency from your creditors. However, there is a program available if you are serious about . This program will allow a credit counselor to work on your behalf with your creditors to lower your interest rates on your credit card accounts and often to set your accounts as current, which will provide some benefit to your credit history. You do not need good credit to qualify for this type of program.
With this program, called a debt management plan, you will be able to make more productive payments to your creditors. Lowered interest rates will allow you to pay less finance charges each month, allowing more of your payments to go directly to paying off your debt. These regular payments will also allow you to improve your credit rating.
If you think you could benefit from a program like this or simply want to find out what other options might be available, talk to an . They will be able to help you determine what steps you should take to lower your credit card interest rates.
