How to lower your credit card interest rate (2024)

Rising credit card interest rates can make it difficult to pay off debt. If you tend to carry a balance on your credit card month after month, those high interest rates, also known as APR, can quickly bring you deeper into debt.

Fortunately, you may be able to combat this by simply calling your credit card issuer and negotiating a lower rate. While it's possible that your request may be declined, there are other options that can help you potentially secure a lower interest rate.

CNBC Select breaks down how you can negotiate a lower interest rate on your credit card and other options available.

• How to negotiate a lower interest rate
• Gather your information
• If needed, improve your credit score
• Compare other credit card offers
• Hang up and call again
• Apply for a balance transfer card
• Bottom line

Before speaking with a representative, it's important to gather any important information so you're prepared for any questions you may be hit with. Be ready to share information about your income, expenses, total assets, liabilities and other details about your financial situation so that your issuer is aware of your circ*mstances.

You should familiarize yourself with your current credit card terms, such as the APR, statement due date and grace period, and have a record of your credit score and credit card use. If you have a history of keeping up with payments and other patterns of responsible credit card use, you could use that as leverage during the negotiation process. It could also help to mention if you've been a customer with the issuer for a significant amount of time because it shows you've been a valuable customer.

While every situation is unique, your chances of securing a lower rate can depend on your credit score. If you have apoor or fair credit score(FICO scores below 670), there are some steps you could take prior to calling your credit card issuer, including:

• Paying your credit card bill early or on time each month.
• Aiming to keep your credit utilization rate — the percentage of your credit limit that you're using — at 30% or less.

If you're making on-time payments for bills like rent and cell phone service, then you can also use Experian Boost™ to potentially raise your FICO® score. It's a free and easy feature that allows you to link your utility, telecom and streaming subscription accounts to your Experian credit file and get credited for making those on-time payments.

By maintaining a pattern of responsible credit use, you'll be more likely to be approved for a lower interest rate, even if only for a limited time.

Another way to negotiate is by comparing your current credit card terms with other similar credit cards. Because credit card companies are competitive and don't want to lose their business, it could help to share that you're considering moving on to another card with a better offer. Even if the issuer isn't able to match the lower interest rate, they may be able to offer a different retention offer in the form of a waived annual fee or bonus points.

Oftentimes during negotiation processes, you may receive an answer you don't want to hear. But instead of settling for the first answer you get, you can try again by hanging up and calling back. You may reach another customer service representative that is more receptive to your requests.

If an agent denies your request, be sure to get an explanation of why and ask if there's anything else you can do on your end to get the lower rate. This information can be helpful for the next time you call.

It can be hard to get approved for a lower interest rate, so don't be discouraged if your request is denied. Another option is to apply for a balance transfer card. With a balance transfer card, the balance from your current card would get moved to a new card with a lower balance. These cards also offer no interest for a set introductory period — at least six months and up to 21 months.

Balance transfers typically can't be made between cards from the same bank, so you'll have to apply for a card from a different issuer. It's also important to note that balance transfers typically come with a fee, even if there's a 0% APR period.

CNBC Select ranked the Wells Fargo Reflect® Card as one of the top balance transfer cards due to its long introductory promotional APR period. New card members receive a 0% intro APR for 21 months from account opening on purchases and qualifying balance transfers (18.24%, 24.74%, or 29.99% variable APR afterward). However, you will need to pay a 5%, min $5 fee to bring your balance from another card to this one and transfers must be completed in the first 120 days.

Credit card interest rates can make it harder to pay off your debt, but you may be able to negotiate a better rate or a limited-time offer by simply calling your credit card issuer. While it can some time and effort and your request may be denied, it doesn't hurt to ask. Before making that call, be sure to gather any necessary information, including your credit card history, credit score and current credit card terms.

If negotiating doesn't work out, try applying for a balance transfer card with a 0% introductory APR like the Wells Fargo Reflect® Card or Citi® Diamond Preferred® Card.

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At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit card review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

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