If you’ve got good credit, you’ve got a lot of leeway when it comes to dealing with credit card companies. Why not leverage your good credit? Some of the best credit cards offer “rewards” to consumers with excellent credit standing.
When most people think of their credit cards they tend to groan at their high interest rates, or remember their past late fees. The truth is, credit card companies are completely willing to work with you, and can even renegotiate your contract with them at a moment’s notice.
All you have to do is manage your credit responsibly first. If you do this, then you have almost limitless options that will allow you to pay less on your credit cards, to remove fees, even to get a better APR!
Let’s take a look at some of the doors that open when you have a credit score above 700. If you want to use these tactics, and you aren’t sure what your credit score is, you can check it by visiting myFICO.com or sites that yield free credit scores.
6 Excellent Ways To Leverage Your Good Credit
1. Renegotiate your APR and get your fees waived.
As long as you faithfully pay your bills on time, it is a simple thing to call your credit card company and ask them to lower your APR, transfer you to a new credit card account with better terms, or remove that last late or over-the-limit fee.
Be aware that you will have to talk to more than one person in order to make this happen, and it will probably be a manager that finally fixes it for you. The general customer service reps are not known for being helpful, and they may actually tell you it cannot be done. This is a lie. All credit card companies have these procedures. Just threaten to transfer your balance to another company and watch the magic happen.
2. Consider balance transfers.
There are tons of people out there who are paying more interest than they need to each month. Are you one of them? If you’ve had a credit card for a long time, and the interest rate isn’t as low as you’d like it to be, consider a balance transfer to a card with a better rate. To successfully do this you will need a credit score that’s over 700. 720 — 750 is an even better range. If you have a credit score over 720 you shouldn’t be paying more than 10% interest on a credit card — unless it is a store credit card like Macy’s of Nordstrom’s.
Balance Transfer Pitfalls — Nearly all balance transfer cards charge a transfer fee. Also, the interest rate you get at first may just be an introductory offer. So read the fine print carefully before agreeing to any offers. After all, the idea is to save yourself some money, not get bogged down in fees and red tape.
3. Refinance your home or vehicle.
Yes, I know the economy is in the crapper, and “banks are not lending” but that’s really not true. Though banks may not be lending to subprime borrowers, folks with good credit will find that right now, the world is their oyster! If you have good credit, then this is an excellent time to refinance your home, or your auto loan.
I can’t stress enough that paying too much in interest every month makes no sense if your credit is good! Just give your credit score a check, and see how you can cut corners by lowering your interest rates on your regular monthly payments.
4. Buy foreclosures
It’s sad that so many have fallen upon hard times during recent events. The number of home foreclosures is higher than it has ever been — up 57% from January 2007. Regardless of what everyone else is doing or going through, now is an excellent time to invest in a foreclosed home because you can rent it out, and earn some extra monthly income. I do realize that a project like this is not for everyone. But for those few intrepid fellows out there, you can use your good credit to generate income for you every single month through your ownership of a rental property.
5. Get the most out of your checking and savings accounts.
Did you know that ING Direct will only let those people with good credit open a checking account? This is because the bank offers killer overdraft protection. Instead of charging you a flat fee like other banks, they simply lend you the money and charge you a set rate of interest until it is paid back. With good credit, you’ll qualify to earn interest in their ING Direct Electric Orange checking account. So again, there are great opportunities for the good-credit-only crowd.
6. Rack up those miles and points, or earn some cash!
If you have a credit score of over 720 and you don’t already have a rewards or cash back credit card, then you are letting one of good credit’s most obvious benefits pass you by. There are lots of cash back credit cards and rewards gas credit cards out there. You can either get money back at the end of the month, or free gasoline.
Other credit cards offer money back through Upromise online so that you can save money for your child’s college expenses. All in all there are so many different flavors of rewards cards out there, that it would be a difficult job to list them all. If something like this appeals to you, then you can definitely find a card that will give you cash back or rewards that will benefit your life right now.
Each of these six benefits are for people with good to excellent credit only. If you work hard to keep your credit score as high as possible, you may want to take some time out today. Spend that time thinking about how you can make your good credit rating work for you. After all, why let the credit card companies have all the fun?
Mr. Credit Card from AskMrCreditCard.com writes credit card reviews and answers reader’s questions about credit cards each day. If you enjoyed this post, why not leave a comment below and tell him about your experiences?
Copyright © 2008 The Digerati Life. All Rights Reserved.