Hello everyone! Hope you are all doing great! Been a little bit quiet around here over the last couple of days – I had the pleasure of having family stay with me and am exhausted! Fear not, here is something that was prepared earlier: Four top tips to achieve a lower loan rate! I must admit, I have used the technique in step 2 in the past when I used to be irresponsible and carry a lot of credit card debt, but some great ideas for everyone!
Qualifying for a lower interest rate on a credit card or other type of affordable fast loan is a great way to save some money in your budget every month. Unfortunately, it isn’t always possible to get a lower interest rate just by asking for one. If you’re looking for ways to reduce your rate, however, try these four suggestions.
1. Refinance your existing loans: Take some time to look at the interest rates on the loans you currently have and contact each of your lenders. Once you’re on the phone, speak to a bank representative about refinancing. Banks will often lower an interest rate on a loan if you can show that you would qualify for a lower interest rate from one of their competitors. Often this is done so that a bank can retain the business that is already has. Don’t let whoever you are talking you to convince you that your current deal is as good as it gets – it most likely isn’t.
2. Lower interest rate using balance transfers: Many credit card companies and personal loan accounts will allow you to transfer a balance you already have on another credit card or personal loan to their account. If you currently have a credit card with a lower interest rate than your other cards and enough of an ‘available’ balance on the card to cover another personal loan or credit card, transfer the entire balance from the credit card with the highest interest rate to the lower card. Before taking this step, however, be sure to consider any fees that are charged on this balance transfer. Sometimes these fees cancel out any potential savings.
3. Look for promotional deals on new loans: Many new and existing banks will offer very low or even zero percent interest rates on loans or new credit card accounts as a means to attract new customers. To take advantage of these deals, sign up for the new loan or card then transfer the balances from your high interest credit cards to the new card or use the cash from a new loan to pay off any high interest debt. Be careful to pay attention to the fine print on the loan paperwork, however. Pay very close attention to the period of time that the new loan will be interest-free for. Usually these types of deals come with interest rates that can rise dramatically after an introductory period. Ensure that you can completely pay off the loan in the allotted time.
4. Try to improve your credit score: If you’re having problems qualifying for preferential interest rates on new loans or credit cards, it could be because you have a credit score that is too low. Obtain copies of your credit reports and review them for errors that could be lowering your score. If you find anything wrong, it is possible to start the process of making corrections. Contact old lenders and agree to pay off old debts if they agree to withdraw the negative information from your credit report. If this doesn’t work, wait a few months and ensure that you diligently make payments on time and your credit score will be sure to automatically rise.
Have you got any other tips? Have you had any bad experiences with loans? Discuss!