Average Credit Card Rates Down Slightly Ahead of Big Federal Rate Cut

Current Averages:
Average consumer credit card rate, overall market: 14.33% Average credit card rate, non-reward consumer cards: 12.77% Average reward credit card rate: 15.00% Average student credit card rate: 14.62% Average business credit card rate (non-reward): 10.68% Average business reward credit card rate: 12.28% Average credit card rates are down slightly from their November levels, and may be headed down further based on the significant, three-quarter-point cut in interest rates by the Federal Reserve today.

However, recent rate cuts have had only a slight effect on the rates credit card companies are choosing to offer, so there is no guarantee that this latest cut will have a substantial impact. As with many of the recent cuts, major credit card issuers could choose to simply re-price their offers in line with current rates versus passing along the rate cut to new customers. (About 70% of credit cards offer variable rates that move up or down in line with Federal interest rates. However, credit card issuers are always free to re-price their card offers to new applicants — or even to those who are already their customers.)
The average credit card rate for credit cards across all consumer sectors is 14.33%, down from 14.39% in late November. In pinpointing a single “average” rate, IndexCreditCards attempts to include all of the various rate tiers that card issuers offer based on an applicant’s credit history, as well as the different rates associated with non-reward versus reward cards. Consumers with better credit histories can often find offers well beneath this average, while those with bad credit histories will likely be offered rates higher than the average.
The average credit card rate for non-reward consumer credit cards fell slightly to 12.75%, from 12.82% in late November, while the average rate on credit cards with rewards decreased to a flat 15.00% rate, from 15.06%.
While the averages listed above attempt to take into account the multiple tiers that many credit card issuers offer, IndexCreditCards.com also tracks the very lowest listed rates, those reserved for customers with the very best credit. This week those averages are 11.10% (previously 11.16%) for the market as a whole, with a 9.29% average for non-reward cards (previously 9.32%) and a 11.87% average for consumer cards with rewards (previously 11.95%).
Student credit card rates fell slightly as well, with an average rate of 14.62%, down from 14.66%. The relatively low rates on student cards continue to be a surprise, as this average is below the average rate on general market reward cards, which rarely happens. It’s hard to know how many student applicants are really getting these rates, but the advertised rates at least suggest that it’s not a bad time for college students to seek credit.
Small business credit card rates bucked the trend somewhat, with the average rate for non-reward business credit cards remaining at 10.68%, and the average rate for business credit cards with rewards jumping to 12.28% from 12.01% in November. The average rate on business reward cards has increased almost one-half point in just the last month.
Financial institutions represented in the survey include Advanta, American Express, Bank of America, Capital One, Chase / Washington Mutual, Citi, Discover, National City, Pulaski Bank, U.S. Bank, Wells Fargo, and more.

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Debt consolidation – Options for Reducing Credit Card Costs

Americans are using credit cards more than at any time in history, and credit card companies are reaping record profits. One of the reasons that the credit card industry is so profitable is that so many of us use our credit cards unwisely.If you have good credit, you can get a credit card with a reasonable interest rate; say 10% or so. You can keep that rate by paying your bill on time. On the other hand, if you pay your bills late or fail to pay in full, then you will have to pay late fees and interest. Late fees often range between $15 and $29; some card issuers may charge even more. Adding to the pain of paying late fees, however, is the likely change in interest rates on your card if you pay late. A late payment may trigger a substantial increase in the interest rate on your card, and that “reasonable” interest rate of 10% may suddenly rise to 20% or even 25%!
It’s hard to pay off your credit card balance when you have late fees and 25% interest, so this is something you definitely want to avoid. If you usually pay on time, and you pay late once and are charged a late fee, ask your credit company if they will waive the fee. They will often do it – once. Some will not do it at all, but it is always worth taking the time to ask. If they are unwilling to help you, then you may be better off shopping around for a better credit card deal elsewhere. You can often save money by transferring your balance to a lower interest credit card, if you have one. Competition has been fierce during the last few years among credit card companies, and it is fairly common to receive “promotional” rates of less than 5% if you transfer your balance to another card. Be sure to read the fine print, however. Those low rates usually apply only to transferred balances, and not to new charges placed on the card. There is usually a time limit associated with the promotional rate, and higher rates may apply at the end of the time limit, perhaps even retroactively!
In summary, if you want to minimize your credit card costs, try the following:

* Shop around for a credit card with a low interest rate.
* Pay your bills on time. A good way to do this is to pay online. That way, you won’t have to worry about your check being delayed in the mail.
* Transfer balances from high interest rate cards to cards with lower rates.
* Use your cards wisely. If you can pay cash, do it.

A few simple steps can save you a fortune in interest charges and late fees.

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Credit Card Debt Freedom is Possible

Credit card debt have you drowning financially? You're not alone. The average American household carries $9,205 in credit card debt, according to CardWeb, an online industry tracker. Not managed properly, this debt can come to eat up all of your disposable income leaving little or nothing for bare necessities. Some people in this situation respond by charging more but that will only get you further in trouble.
Fail to plan and you plan to fail
There is this cliché that states that if you fail to plan you plan to fail. The first thing you need to do is evaluate where you want to be. Do you want freedom from your credit card burden? Is so, you need to develop a different action plan to the one you are currently following. Makes sense doesn't it?
Start by listing all of the debt you currently owe along with a list of what your monthly obligations are for each debt. At the top of the page, list the amount of income available to pay these debts after essentials like food, hydro, etc... are taken out. When listing essentials, it's important to include a certain amount for clothes, medical and entertainment because no matter how good your intentions, you will spend some money in these areas. If you budget ahead for them, you are less likely to just waste it.
Start paying one credit card first
Don't try to pay off all of your credit cards at once. Doing this will take too long and end up discouraging you. You're better off concentrating on getting one card paid off, then putting the money you've freed up from that one card and applying it to the next one and so forth.
Which credit card charges you the highest rate of interest? Start with that one. Pay the minimum due on all of your credit cards expect for the one you have chosen to focus on first. On that card, put as much money as your budget allows onto the card after all of your expenses and debts have been factored in. Keep doing this month after month until the credit card balance goes to zero.
Loose all credit cards except one
Plan to keep one major credit card for unexpected expenses, car rentals and emergencies. Get rid of all your other cards as you pay them off. Most people can't resist the temptation to spend money on a clean card. If this describes you, you're better off without many credit cards than you are to get right back into deep credit card debt.
Follow this plan, and depending on how much you owe, in a year or so, you should have pretty much achieved credit card debt freedom!

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How To Find Reliable Debt Settlement Companies

Before you file bankruptcy or start an intensive debt management plan consider seeking out one of the many reliable debt settlement companies that are on the market.
Debt settlement is a popular way of regaining financial wellness. If you’ve fallen considerably behind on high interest credit card payments for instance, it could take you as long as 20 years to get back on track. With reliable debt settlement companies you may be able to settle for up to 75% of your actual debt and often in as little as three years.
First off it’s important to understand debt settlement and how the process works. Essentially, debt settlement is a negotiation process where by one of the many reliable debt settlement companies you’re considering will negotiate with your creditors on your behalf.
It’s the job of a debt settlement company to convince your creditors of the value of lowering the total amount of money that you owe. A little money is better than no money at all.
When you sign up for a debt settlement program many creditors will do what is known as ‘re-aging’ or bringing your account into a current status.
Once a settlement is reached it’s your responsibility to pay the agreed upon amount in full. Your debt is cleared when you owe no more money. This whole process may take several months to accomplish during which you may still be harassed by creditors.
This is where the best in reliable debt settlement companies come in. The company will work on your behalf to field all such communications.
Understand that debt settlement demands that you maintain a strict budget as reliable debt settlement companies will usually take monthly payments directly from you and hold the balance in trust.
Once a debt settlement is reached you will find that reliable debt settlement companies will than make a one time payment to your creditor followed by final credit report documentation that your account is now paid in full. Once your account is settled you will no longer have a negative report.
If you have more than one debt, the debt settlement process is repeated for each creditor.
You’ll also find that some reliable debt settlement companies offer credit repair as part of their debt settlement services. Although there are usually fees for any credit repair, it does wonders for removing blemishes from your credit report.
Since debt settlement is one of the fastest debt relief methods there is to clear your debts in three years or less, you’ll find that there are a ton of debt settlement companies seeking your business.
When doing a search for debt settlement companies it’s important you do your homework. You’ll find you can save a substantial amount of money by finding one of the many reliable debt settlement companies that will work towards eliminating your late fee and interest payments.
Remember however that a good debt settlement company can’t do it all for you . Even the reliable debt settlement companies will take issue with you if you don’t have the self-discipline to stick with the program and work with them.
The bottom line is that reliable debt settlement companies will look out for your best interests as long as you do your part and keep the agreed upon payments coming.
Your search for debt settlement companies is bound to undercover a ton of debt settlement services but asking questions and understanding the ins and outs of how the process works is one of the best ways of knowing if you’ve found one of the most reliable debt settlement companies on the market..

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Is Debt Negotiation Bad?

Is debt negotiation bad? Well, yes and no. It all depends on your situation and how you view the negatives (and positives) of debt negotiation. Educating yourself about the ins and outs of debt negotiation is a good first step. Please note that the term ‘debt negotiation’ is also known as debt arbitration or debt settlement.
For starters, a lender has little motivation to arbitrate anything less than the full amount unless the person is two to three months behind in payment.
To answer your question is debt negotiation bad? You need view it as a last-resort measure. The truth of the matter is it’s one step away from declaring bankruptcy.
Remember, your lender gave you the money or property in good faith. He or she has every right to expect that the loan be repaid in full. Morally, you should do everything that is within your power to pay your debt(s).
However, this is not always possible and despite how much you would like to repay the loan in full you just can’t – not now and not in the foreseeable future. This is where debt negotiation comes into play. It may be your only logical course of action.
And, in the case of an old debt that you’ve long since forgotten about, debt negotiation would be the best way of dealing with it. There’s no point in keeping a small blemish on report when a little negotiation can easily turn things around.
But if you find yourself overwhelmed with your current debt load, credit counseling should instead be your first action step. A credit counselor will give you some tools and suggestions for reducing your payments.
Debt consolidation may be more appropriate. A credit counselor will walk you through the debt consolidation process. In a nutshell, it means creating a whole new loan for a longer period of time. This would hopefully lower your payments enough so you can get back on track.
Please know however, that debt consolidation can be nothing more than a way of putting off the evitable. It really does little to correct the problem. That’s why many people come back to debt negotiation as a way of getting out of their financial problems and starting fresh start.
If you’re determined to pay of your debt(s) and turn over a new ‘financial’ leaf you may wish to contact your creditors yourself. By doing so, you may be able to negotiate a lower interest rate or a more realistic repayment plan. This is known as self arbitration.
So, is debt negotiation bad if you really need it? The bottom line answer is no. When your debt is very delinquent, negotiation is often in your best interest. If this is the case, now is the time to either consider self arbitration or seek out the help of a debt negotiation company.
Although a debt negotiation program will lower your credit score for as long a you’re in the program, you’ll also find that most debt negotiation companies require the creditor to make sure that the final credit report reflects the account is now paid in full. Therefore, once your account is settled you will no longer have a negative report.
A number of debt negotiation companies also include a credit repair service as part of their debt negotiation program. This repair service removes any negative items caused by the program. Although it is part of the program there are additional fees associated with this service.
Is debt negotiation bad? Ultimately, you’re the best person to judge whether debt negotiation is right for you or if it’s in your best interest to consider another alternative such as debt consolidation.
This is where negotiation and your question, “Is debt negotiation bad?” comes in. Debt negotiation is bad in that it means the complete destruction of your credit history.

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Debt Negotiation On Credit Cards

Debt negotiation on credit cards is also often referred to as credit card debt settlement. People to turn to credit card debt negotiation when they find they can’t handle a debt consolidation program. If you find you’re unable to make the minimum payments of a credit card debt consolidation repayment plan or haven’t been able to make payments in the past three months, a credit card debt negotiation program is the next step in solving your debt and credit problems.

One of the advantages of a credit card debt negotiation program is that you cease making payments to your creditors. The debt negotiation company usually takes the monthly payments directly from you and holds the balance in trust.

During which time you’re conducting your debt negotiation on credit cards and are making regular payments through a credit card debt negotiation program, the debt negotiation company will negotiate with your creditors for a lower payoff of around 40 to 50 % of your total amount of debt.

As soon as a settlement is reached your debt negotiation company will then make a one time payment to your creditors.

A disadvantage of a credit card debt negotiation program is that it lowers your credit score for as long a you’re in the program. However, most debt negotiation companies require the creditor to make sure that the final credit report reflects the account is now paid in full. Therefore, once your debt negotiation on credit cards account is settled you will no longer have a negative report.

A number of debt negotiation companies include a credit repair service as part of their credit card debt negotiation program. This debt negotiation on credit cards repair service removes any negative items caused by the credit card debt negotiation program.
Although it is part of the program there are fees associated with this service.

A credit card debt negotiation program is not your only answer. You may wish to self arbitrate. If you’re determined to pay of your debt(s) and turn over a new ‘financial’ leaf you may wish to contact your creditors yourself. By doing so, you may be able to negotiate a lower interest rate or a more realistic repayment plan.

If you decide to self arbitrate, you’ll also want to have a written agreement with your lender or collector that makes note of the fact your settlement has been ‘paid as agreed’ or ‘satisfied in full’.

Regardless of your approach – self arbitration or going with a credit card debt negotiation program you can be successful. Positive debt negotiation on credit cards will be realized once you’re committed to paying your debt(s) off once and for all. And, just think how good it will feel to get out from under all that ‘debt’ weight.

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