Mapgirl’s Fiscal Challenge

First, the update. I forgot to tell you. I gave away the pet birdie. I found someone off of Craigslist who is really going to enjoy having her. She now lives in a house full of kids and pets. I admit, the stray kitten they found looked a little in need of veterinary care, but there were other birds who will keep Papagena company. I just couldn’t stand keeping her when I couldn’t spend time with her. She really needed constant company.

Now, onto the juicy confession. Remember when I had a boo-boo with my credit card payment in May? Well, I’ve been avoiding telling you that the credit card decided to put me into the universal default interest rate of 32.0%. Luckily it didn’t trigger a rate change on my other cards. I was damned lucky on that.

But I did decide to balance transfer off most of what was on the card to my HELOC, going from 32% to 10.38%. The interest savings was too great to ignore. I still use the card because there are some recurring charges on it (EZ Pass fees), but I pay it off religiously and in full now. (Side note on my net worth data, I do not include the transferred amount into my mortgage line item. I have left it on the credit card line.)

When I first realized the rate jumped, I re-read the card agreement and found out that the 32% rate was going to last 6 months, i.e. till November. I was all prepared to wait it out and keep paying things on time and in full, without carrying a balance. However, I decided that since 4 months have passed without an incident, I would call them anyway. I wanted to see if I could also get a really low teaser rate balance transfer later as well. Because 10.38% is ok, but not great.

I called them this week and they lowered my rate back down to 13.74%. It was very easy. I also inquired about balance transferring but they told me to call back in a few days. We’ll see about that. I’m not sure that I really want to do the transfer. I just liked the idea that I was doing SOMETHING to improve my situation rather than nothing.

The takeaway for you:
Even if you’ve triggered off a default interest rate on your card, you don’t have to wait a full six months to get your rate lowered back down. Call them after a few months of on-time payments and ask if they will lower them again. It can’t hurt you to ask. There is only the upside here of a possible yes that lowers your rate again.

Final note: I paid to check my credit score the other night and it’s a 696. The main thing is that I need to lower my utilization which is why I was interested in a balance transfer. I have 3 cards, and one is at 80% utilization. I figured if I started spreading that onto two cards, the score would lift. But I have no major purchases coming up in the next 2-4 years so I don’t really need to do this at all. I just need to get all of it paid down.