What To Do When Your Credit Card Rates Increase?


Hi I had citi Advantage World MasterCard for the past 9 Yrs. Excellent customer with on time payments and paid over amount balance due each month. I received a letter from them now increasing my APR to 18.99% from 14.99%. When I ask why they told me we had to adjust our pricing? With no other explanation. My question is can they do this and is there a card out there with a lower interest rate to do a balance transfer.Do I close the account ? Does this affect my credit if I do this? Where can I find a reasonable rate?

ms christine shute

Answers – Christine – Yes, they can do this. Credit Card issuers cannot arbitrarily raise your rates when the CARD Act takes effect in February, but they can certainly do so now. With regards to your second question as to whether there are lower rate credit cards to do a balance transfer? Yes, there are a few cards that offer 0% APR for balance transfers and here are some with potentially lower rates than yours at the moment.. Most have no annual fees and hence you will probably save some money if you do a balance transfer.

The actions taken by your credit card will not affect your credit score though it will be affected if you have problems paying the higher minimum payments that will be required from you going forward.

Best advice I can give is to transfer your balance to another card (assuming you have a good credit and will be approved for a card) and then pay off your debt as soon as possible and stop carrying a balance. That way, you will never be affected by interest rate increases.

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