20.99% no more!
Posted on February 09, 2006 by Him and tagged balance_transfer, credit, debt
My second credit card ever was a Citibank Platinum Mastercard, with a credit limit of $1,800. I was young and seduced by the fact that I was receiving a Platinum card. The card came just in time for Christmas, but more importantly, it came right after I maxed out my first credit card!
This card has been the bane of my existence for the past few years. Within a few weeks after I got the card, I maxed it out, and the monthly interest rate pushed the balance to over my credit limit, and then I got hit with the over the credit limit fee. I think that the card was over the limit most of the time I was an undergrad. In the time between undergrad and grad school, I was really tight on cash, and I neglected to pay even the monthly minimum payment on this card. Twice. I was over 30 days late the first time, 60 days the second. Subsequently, the APR went up to 20.99%.
The worst part of all of this is that the 20.99% interest rate was "grandfathered" in. A few months ago I called the company and tried to get the rate lowered. The rep was very nonchalant in telling me that nothing could be done, and that the rate was stuck. I don't ever remember getting receiving word that the rate was going to be fixed - I probably just trashed whatever mailing that they tried to communicate that to me with.
Since my FICO score was low, I was getting really crappy offers in the mail (see example) that didn't help at all, and I didn't want to risk having too many inquiries on my credit report, further lower my score. I was seriously between a rock and a hard place.
Earlier this week I received a credit card offer that proved to me that changing our financial behavior pays off - a card with 0% APR on balance transfers until April 2007, and a rate of 12.9% thereafter. I was a bit skeptical, because receiving a credit card offer doesn't mean that I'll actually be approved. She and I deliberated for a bit about the potential cons of applying for the card, but the potential pros eventually won out. So earlier tonight I called (right in the middle of a drapery installation session -- sorry hon, for leaving you hangin') and got approved! Not only did I get approved, but I now have a $2,500 credit limit, meaning I can (and will) put more than one credit card balance on there. It is kind of sad that $2,500 is my largest credit limit EVER. The only drawback to this whole thing is a 3% balance transfer transaction fee. Compared to the hundreds of dollars that I'll save, it's not so much of a bad deal.
Bye bye, Citibank. It's been fun.
Comments/Trackbacks
Trackback URL: http://www.makelovenotdebt.com/MT/mlnd-trackbacks.cgi/808
That's a pretty good deal for your situation...congrats!
I am wondering (From a curiosity standpoint alone, YOU have a great plan here) if your improving credit score wouldn't make you eligible for a new and better rate (not that they would give you 0%...) even at Citi (nothing is permanent!) It was probably that at the point you called your rating was such that the lowest the rep could offer you was the 20.99 -- and that someone in retention, at this point, might be willing and have the authority to lower your rate to something like 14.99 or so (because they'd probably rather have you paying them 15% on your balance than none if you think about it)
Anyhoo...I love all these stories of folks stickign it to the CC's today -- Seattle Simplicity threatened to close her amex and they gave her money LOL
Not such a bad deal. Do the transfers. Close the old high interest credit cards, and then pay a bit extra on your card debt... starting with any higher rate cards.
It is a good step.
BTW, as the credit rating improves you receive credit cards balance transfer offers. Last one I used (some time ago) was from Capital One. 7.9% fixed, and 0% initially. Balance transfers didn't had ANY balance transfer fees.
Trainwreck | Feb 10, 2006
Awesome! You are making all the right moves. You are on your way!
Reply to this comment