There are multiple ways to reduce a credit card finance charge, from simply asking the credit card company to never being late to pay the bill. First, stop charging the credit card if you cannot pay it off every month in addition to never missing a payment. By doing these things, you end up paying no finance charge each month, plus showing the credit card company that you are reliable and deserving of a credit card finance charge reduction. Next, call the credit card company to ask for a reduction or send the company a letter in writing. You can also get a consolidation loan, but this should be a last resort, especially if you might be tempted to max out the credit cards all over again.
For many people, a credit card finance charge is an everyday bill; it is a responsibility that comes with owning a credit card. If you pay off the credit card bill each month, however, you actually do not pay a finance charge at all. In some cases, a credit card comes with a yearly charge, in which case this fee must be paid every 12 months. While paying the bill in full is essentially a method of reducing a credit card finance charge to zero, this option is not available to people who cannot afford to make the full payment. For these people and those who want to reduce finance charges just in case, there are other options.
Even if you cannot pay off the credit card bill, you can prove yourself reliable by never skipping a payment. In addition to looking good to the credit card company, you avoid paying annual percentage rate penalties. These penalties are typically applied to accounts that make a late payment. They can double or even triple the amount of interest you normally pay.
Another way to reduce a credit card finance charge is to simply ask by calling customer service. Depending on the credit card company, you might also be able to do this online or by letter. Some people report having more luck talking to a person on the phone rather than through email. If turned down for a reduction, try a different method of asking or just ask later.
Lastly, a consolidation loan is basically getting a loan to pay off your credit card balances. The loan must have less interest than the credit cards for this method to work in your favor. Once the balance is gone, you no longer pay a finance charge for that credit card. You are now responsible for paying off the loan in addition to keeping the balance paid on your credit card each month. If this might prove a difficult task, acquiring and maintaining a consolidation loan might be too risky to attempt.
