Lowering Credit Card Rates After Bankruptcy
At first glance, the title of this article might seem a little ambitious to you. After all, if you have credit cards after personal bankruptcy, you just may feel grateful that you even have access to credit. Therefore, you may be willing to put up with any interest rate that your lenders want to charge you, since you think that many other lenders wouldn’t offer you the same opportunities…
Actually, many credit card companies specializing in targeting post-bankruptcy debtors play on these emotions to justify their sky-high interest rates. They know that since your credit will be limited immediately after declaring personal bankruptcy, you’ll be more open to accepting these large interest rate hikes. Additionally, these companies know that federal guidelines prohibit you from declaring bankruptcy again for several years – and that means you can’t escape from any debts incurred on these cards.
Before we look into lowering your interest rates after personal bankruptcy, it’s important to note that you need to expect higher rates than traditional cards. This is because the creditor feels that they carry more risk in lending to you. However, that doesn’t justify the exorbitant interest rates that many people experience.
Therefore, let’s take a quick-fire look at how you can lower your credit card rates after personal bankruptcy:
1. Call your lender and let them know that you’d like to negotiate on interest rates and fees. It never hurts to ask, and many card companies will be willing to work with you.
2. If the credit card companies are still unwilling to lower your interest rates, head to Credit.com to take a look at cards with much lower rates than what you’re paying right now. While you won’t qualify for all of them, it’s still worth looking to see if you can get a better rate. Once you do have that card, transfer the balance from your old card and enjoy your lower interest rate.
3. Sign up for a secured credit card, which has lower rates than traditional unsecured credit cards. These cards use a cash deposit as collateral against any late payments, meaning the lender carries little to no risk – meaning you won’t have to deal with sky-high interest payments with every billing cycle. The other great thing about secured cards is that they are treated just like regular credit cards on your credit score.
Declaring personal bankrupt is hard enough. Don’t let credit card lenders looking to make a quick buck make it even harder for you!