How to Get the Best Charge Card Rates

The best charge card rates will be given to the lowest risk borrowers. Your risk profile as a borrower depends on a number of factors including: your income, your credit history, debts and your spending habits. All charge cards will have relatively high rates compared to installment loans, but some will be higher than others. If you can turn these factors in your favor, you will find your charge account is more affordable.

Report All Income

You may not be required to provide a proof of income for a charge card application. These applications tend to be a little shorter than installment loan applications. However, if you report all of your income, you will be more likely to get high limits on the card. Having too much credit can be a bad thing. Having high limits on just a few credit cards, though, provides a host of benefits. One of these benefits is a lower debt to credit ratio. Whenever you have a lower ratio, you will see generally lower interest rates on your loans.

Boost Your Credit

The most important factor is your credit history. If you have a good credit score, you will be eligible for the lowest rates. Make sure you are current on all debt payments to boost your score before applying for a charge card. It is best to keep payments current for at least two years prior to applying for any loan. If you do happen to have a late payment on your report, then you can mitigate its affect on your rates by submitting an explanation of why the payment was late. Borrowers that are out of work, serving in the military or divorcing, may get some leniency this way.

Pay Down Other Debts

You can also boost your credit score by reducing the total amount of debt you owe. It may not be possible to pay off your mortgage or student loans immediately. However, you can potentially pay down the balance on another credit line or pay off a small personal loan you may have. Paying off a loan is the best way to build your credit fast. It can even be worth the prepayment fees on the prior loan if the savings on the new loan are great enough.

Monitor Your Spending

Once you have received your charge card, your spending habits will affect the rate. Most charge cards are given with variable rate terms, and you will have to use the card wisely to keep the rates from adjusting too high. Missing payments automatically increases your interest rate. Failing to pay down balances can also lead to higher rates. It is best to keep your balance below 10%. If you have to make a large payment, then pay it down quickly so you have a lower than 10% balance on the card and avoid costly interest.


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