Should I apply for a fixed rate loan to pay off credit cards?

I’d prefer you to look at your credit card offers, look at the lowest rate APRs offered, call your highest-rate credit card company and negotiate a lower APR.

CUT YOUR CREDIT CARD INTEREST. Cutting your credit card interest rate is really just a matter of doing one of two things: reducing the rates on your curorent cards or transferring your balanaces to cheaper cards.

* Start by laying all your cards out on the table and listing the APR you’re paying on each. Note whether those rates are fixed or variable.

* Next, ready your ammunition. Gather all the preapproed offers you’ve received in the mail. (When you call your companies to ask for a break, you need to be able to tell them who’s offering you a better deal and how much better it is.)

* And have a rough idea of how valuable a customer you’ve been: how long you have had the card, how much you charge a month or year, how much interest they’re earning each year on your business, and whether you pay on time. When you’ve got it together, you can proceed.

Call the toll-free customer service number and ask or a lower rate… calling and asking for a lower rate results in a reduction 56^ of the time — and a substantial reduction (1/3 of their current rate) at that. Here’s a script to follow when you call.

Begin with: “I have [name of card] with you and my interest rate is [X] percent. I received another offer in the mail from [other bank's name] for [X] percent, but before I take it, I want to see if you can lower my interest rate instead.”

If the representative says they’re not authorized to do that, you say: “Look, you and I both know that if I transfer my balance today, next week your bank is going to send me an offer to come back at an even lower rate. Why don’t you just save the bank the cost of that effort by giving me several points today?”

If the rep says it’s not possible because your credit card is at a fixed interest rate, you say: “Actually, that doesn’t have anything to do with whether or not you have the ability to lower my interest rate. A fixed interest rate only means that my rate doesn’t very with fluctuations in the prime rate. In fact, the bank can raise it on my account at any time by just giving me 15 days’ written notice. And the bank can — if it chooses — lower the rate today.”

If the rep still says they’re not authorized to do that, you say: “I’d like to speak to your supervisor.”

Speak to a supervisor and ask again. Even if you get a substantial cut in the interest rate from the first person, it’s worth speaking to a superisor to see if you can do any better. The person on the front line of customer service will be authorized only to cut your rate by a preset amount (if at all). The customer service representative may also insist that the supervisor doesn’t have the power to cut your rate either, or — if you’ve already gotten a break — to cut it further. That may not be true, so insist on speaking to the supervisor anyway.
Threaten to close your account. Let me be clear here: You don’t WANT to close your account. It won’t do good things to your credit score. However, if the bank believes that you’re willing to close your account — and you’ve been a profitable customer — then you stand a better chance of getting what you want.

Keep a record of whom you spoke to and what was said. If your promised rate cut — or fee waiver — doesn’t materialize, then you’re going to need a paper trail to back up your story. Knowing to whom you spoke, when the call was placed and what was promised is key.

Transfer your balance. If you’re not successful in reducing your interest rate over the phone, it’s time to transfer your balance. There are two places to find good balance transfer offers: your mailbox (the average person gets five credit card solicitations a month) and at websites, including bankrate.com and cardweb.com.

I hope this helps!