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  1. #1
    Deal GURU
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    Default question about credit cards

    I have a friend who switches credit cards all the time. she will take advantage of the 0% interest then when it runs out, transfers it to another and cancels that one. She suggested I do it, but I am not sure if this actually works. does anyone have any experience with this?


    Marguerite
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  3. #2
    Deal GURU
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    Yes it works...for awhile....sooner or later she will run out of credit card companies. The thing about 0% is that we sometimes buy more, just what they want us to do.... Why doesn't she just call her current credit card companies & ask for a lower rate? My husband & I were paying 15% & called the compay & got it lowered to 5%. As long as she pays on time she shouldn't have any problem.......

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  5. #3
    Deal GURU
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    I keep hearing that you should just call and ask for a lower rate. The thing is - most people don't "need" a lower rate until they run into trouble, and at that time, the companies are nowhere near wanting to help you out in any way by lowering your interest rate or anything else remotely "favorable".

    So, what do you do when the payments are already behind, you are being charged fees up to your eyeballs and are drowning under the debts? How do you get a lower interest rate, fees waived, etc.??????

    If anybody knows, please share.

    Thanks!

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  7. #4
    Deal GURU
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    We weren't in trouble when we called for a lower rate. We have 1 card with 0% interest that my husband uses for business (he is self employed) the card I use is the card that we asked for a lower % rate. I needed tires & going to save up for them, but I was losing my job in a few weeks, so I put them on the card & have it almost paid off now. Call the credit card company & tell them what is going on, they may surprise you & help you out. Several years ago before I got married I had a card & called to see if something could be worked out. It was sent to charge off (I didn't know what that meant) I was able to work something out to get it paid off, no late fees & no interest just because I was trying. Worth a try.

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  9. #5
    Deal GURU
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    It also hurts your credit score to keep applying for
    more credit cards...not worth it in the long run.
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  11. #6
    Deal GURU
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    I heard canceling a credit card can hurt your credit rating. I don't know if this is true or not.
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  13. #7
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    You don't want to apply for too many cards. Every inquiry that a company makes when deciding whether or not to approve puts a mark on your credit report.

    Once opened, if you cancel a line of credit, it damages your credit by lowering your ratio of available credit vs. credit used. For instance, if you have $50,000 available to spend and you actually are using $10,000, you have one ratio. On the other hand, cancel a couple of open lines of credit (credit cards) and you have $20,000 available, but you are using $10,000 of it, then to potential creditors, you have used 50% of what is available to you. In the first example, you have only used 1/5 of what is available. In the second, you have used 1/2.

    NOTE: If you are one of those people who opens credit cards just to get the 10% off of today's purchase at the store, pay the item in full when the first statement arrives and then close the card. It will only be on your credit report for a month (less actually, since most companies have a "grace period" of 21-26 days now). It will not be as damaging.

    It is still not a smart way to operate though.

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  15. #8
    Deal GURU
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    It helps to keep the old account open even if you're not using it. I
    read that it will give you a longer credit history.
    I would say switch to a lower interest credit card, keep the other
    card open and just pay off what you owe on time and in a
    bigger-than-the-minimum amount. Soon it will improve your credit
    score. The interest rate may not stay at 0% very long but if you stay
    on time with the payments it shouldn't rise too much.
    As far as switching around whenever the interest rate changes, I'm
    not sure thats a good idea. I'm going to read up on it though.
    g.w.
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