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Low Interest Rate Credit Cards
Follow These Steps to Qualify

    With the record low fed rates, low interest rate credit cards are more readily available than in recent years. The real challenge is evaluating the options that are offered to determine real costs.

    Once you find an attractive low interest card, the process for qualifying can be another challenge.

    The Importance of Your Credit Score

    Everyone understands that you must have a decent credit score to qualify for a credit card. Many do not grasp that credit scores also determine the type of card for which you can qualify. To obtain a low interest credit card, you have to have above average credit scores.

    Bankers evaluate credit on a scale of perceived risk. The more risk a potential card holder represents, the more the bank is going to charge. That can mean being charged more interest to use a credit card.

    Steps for Qualifying:

    1) Have the best possible credit score.
    With what was just mentioned about credit scores, the first step in qualifying for a low interest credit card is to review your credit score. You can get a good idea of where you stand from any one of the three credit reporting agencies. If you need to improve your score, there are numerous sources online that can give you advice on how to get that done.

    2) Find the latest offerings.
    If you feel you have reasonable credit, do a search online for the latest offering of low interest credit cards. The rates and number of banks offering cards change frequently. There are several online services that keep up to date information on what is available.

    3) Evaluate your options.
    One thing to be careful about is evaluating the total costs of any card you are considering. A low interest rate credit card might end up being more expensive if there are more fees and charges than with a higher interest card.

    Determine whether an offered rate is just a teaser and how long it will stay low. Remember the banks are in the credit card business to make money. Credit cards are one of their most lucrative business segments. They may try to make up in fees what they lose in interest.

    4) Call your current credit card company.
    If you are a good customer with an excellent payment history, your current provider may be willing to match other low interest rate credit cards. There is a surprising degree of flexibility with many providers in today's competitive environment.

    Explain what you have found and that you are considering moving your account. Even if they don't lower the interest rate, you may get some other benefit or concession that is attractive.

    5) Maintain your rate.
    Once you qualify for and get your low interest rate credit card, read the terms and conditions. Many banks will raise the interest rate if you are late or over limit. That can defeat the entire process.

    6) If you don't qualify.
    If you are one of the millions that have been hurt by the economic downturn, you may be struggling to keep up with payments on your current card. Just as you can call if you have good payment history, you can call if you are in trouble.

    Call your provider and ask about their debt management and forbearance plans. You can end up with a low interest rate credit card through such a program. They may only lower the rate for a period of time but that can save money.

    Remember, the best way to save on credit card interest is to pay the balance off each month.

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