5 Credit Hacks to Lower Your Interest Rates

Balance Transfers 

Taking your balance from a high-interest rate credit card and moving it to a low interest one is a simple and easy way to lower interest rates. If you are someone looking to improve their interest rates, there are many 0% balance transfer options out there. In general, this is a great way to get a lower interest rate on your credit cards but when doing your own research on which transfer option is right for you, be mindful of any transfer fees. 

Improve Credit Score 

In order to earn lower interest rates from a bank, you need to make sure you have an adequate credit score. By improving your credit score, you prove to banks that you are responsible, making you eligible for lower interest rates. But you might be wondering, how do I improve my credit score? 

Here are some simple steps you can take: 

  • Keeping track of charges 
  • Thinking long term with spending and saving 
  • Sticking to a budget 

If you find that you have bad credit, you probably have bad spending habits. 

Apply For a New Credit Card  

After big purchases such as a car or a house, your credit score can suffer which could see you paying a higher interest rate if you get a new credit card during this time. However, you can apply for a credit card right after the purchase. 

This is because there is generally a bit of a lag following a purchase between when you buy something and when the effects show up on your credit score report. If you absolutely must get a new card, we recommend doing it before the report is updated. This will allow you to get the lowest interest rate possible because your credit score is much lower than it will be once it updates. 

Ask Your Friends…  

If you have friends in the same bank, try asking them how much they are paying on interest rates. We know that it’s awkward to talk about money with friends. But this can ultimately be beneficial for everyone involved. Knowledge is power, so knowing how much your bank is charging other people can really help when it comes time to ask. 

A big part of getting lower interest rates is negotiating. And if you’re going to negotiate, you need the information to back it up. Now, what do you think is more effective? “You should give me lower interest rates,” or, “Your client (friend), who is roughly in my age bracket and has a similar credit score, has this much interest. I’d like to have a similar interest rate to them.” 

The more you know, the better. 

…Or the Bank 

When in doubt, you’re going to have to ask your bank for lower interest rates. Persistence and politeness will get you far in this regard, but sometimes you’ve got to be willing to go if they do not make an offer. Having interest rates that fit your life situation is something customers deserve and if you make it clear that the current system is not working for you, do not hesitate to make that known. 

Want more tips to lower interest rates? 

While these tips are great to help you in the long term, you may need to pay off the interest rates in the short term. That’s what we are here for, because at Cigno, we offer short term cash advances up to $1000. Of course, you should only borrow as much as you need to, and as much as you can repay. But if that sounds like you, we encourage you to use our services. 

Contact us today to learn more about what we offer. 

Disclaimer: Please be aware that Cigno Loans’ articles do not replace advice from an accountant or financial advisor. All information provided is intended to be used as a guide only, as it does not take into account your personal financial situation or needs. If you require assistance, it is recommended that you consult a licensed financial or tax advisor.