If you have a low interest credit card, then you have the ability to save a lot of money on your debt. If your APR is 10% instead of 30%, then you are saving three times the amount over the high interest options that are available right now! The only problem that consumers face today is that low interest credit cards have strict approval thresholds that must be met.
Not everyone is going to be approved for these cards.
If you want to be approved for a low interest credit card today, then here is what you need to do in order to make sure it happens with your financial situation.
#1. Always pay your bills on time. If you are missing payments, then you have a lower credit score automatically. Lower credit scores always equate to higher interest rates. Even if you just have two missed payments in the last 12 months, that may be enough to disqualify you from a low interest credit card today. If you have just one account at a collection agency, there is also a good chance that a low interest lender will disqualify you from their best credit products. Manage your payments wisely and you’ll get the low interest rates that you want.
#2. Keep your accounts open. If you have paid off a credit card, it can be tempting to want to close it. The only problem is that part of your credit score is based on the length of time you have a credit history. Accounts that are older show long-term responsible management of financial products. That’s why you should never close your oldest credit account if at all possible.
#3. Watch out for high debt amounts. Even if you have an excellent credit score, if you have utilized the majority of your available credit, you may not be approved for a low interest credit card. When lenders see credit card applications from consumers who have utilized almost all of their available credit, they don’t see opportunity. They see desperation. Try to pay off some of your debt first before applying for a new credit card so that you can secure an approval.
#4. Monitor your credit report. Your credit report is the foundation of the credit score that lenders use to approve you for a low interest credit card. Even small errors on your credit report can result in big changes to your credit score. Take a look at your full credit report at least once per year and quickly dispute any errors that you might see. That’s because any dispute requires a credit bureau to investigate claims.
#5. The types of credit that you currently have also matter. There are rare individuals that have a dozen credit cards or more and can get approved for a new low interest credit card. For the average person, however, the type of credit that you have counts. The variation in credit shows a lender that you can be responsible in different financial environments. Even without a perfect credit score, it is possible to be approved for the credit card you want if you show repayment responsibility on different forms of credit consistently.
It isn’t easy to get approved for a low interest credit card, but it happens every day for people just like you. Use these tips to improve your credit if necessary so that your credit score can make a lender want to approve you for their best line of credit.
Categories: Credit Card Applications