credit card question

[toodycat]

I just received a notice from my credit card company, saying that they are increasing my interest rate from 9.99 to 13.24% in an effort to "remain profitable." I have an excellent credit rating and the card has had a zero balance for a while. I already have other credit cards with rates as low as 8.99% and therefore, don't really need this card anymore. The notice said that if I did not agree to the new terms, I had about a month to notify them in writing. If I do not accept the new terms, my account will be closed which is fine with me. My question is: what impact will not accepting the terms and permitting them to close my account have on my credit rating? Right now, it is really good and I don't want to mess it up. Thanks!

 

[Mom of three]

Have you had the card for a long time? If so, closing the account may drop your score a tad, since you have obviously built up a history.


This could also work to your advantage. What I would do (and I do this quite often) is call up your CC and threaten to close the account if they cannot offer you a lower rate, or at least keep it the same. Afterall, you have an outstanding, established history with them.

But then again, you stated you have had a zero balance with them for a while. If you don't normally carry a balance with them, they may not have any reason to offer you lower.

You could also hint that you were looking at making a "major" purchase soon and would like to take advantage of a lower rate that is being offered by a competitor.

American Express will call usually call your bluff and they don't seem to care much about losing customers these days.

Ive had a BOA Visa for a while now and usually carry a balance, they've always treated me well and usually honor my rate decrease requests. NOT ALWAYS, but a good share.

Citi is great about lowering rates too....just ask.

All this is just based on my own personal experience, others may have different experiences.

Best of luck!

 

[dacky041208]

My wife had the same thing happen. We just use that card less now and make sure that when we do use it, we pay off the full balance each month so we don't get charged any interest.

 

[vegasnative]

Yep, I just got the same letter from our cc company. So those of us that have never defaulted are having to pay higher interest rates to cover all those that are having their cc's taken away from them left & right and/or claiming bankruptcy....lovely huh!