Student Credit Card Forum

[kwatson02118]

Is there a way that I can lower my interest rate and start over with a clean slate with credit card companies after I've payed late or gone above my credit limit?

[Credit Card Guy]

In some cases, yes. Its call re-aging your debts. More on it in a moment.

The key to rocky situations with credit cards is communications and an understanding of their business. They are in business to make money and they do it off fees and interest rates. They like it when you are late on a payment and they like it when they are forced to apply a punitive APR due to your bad behavior. That being understood, when you do communicate realize that they are coming from where they want to be and have you at their mercy a bit. Communicate with them about what you own, what you can't pay and be prepared to explain what you can pay and when. Don't over estimate, you're really in trouble if they settle for a lower payment or a late payment and you blow it.

Now back to re-aging. Here's a bit from one of our articles called The Student Credit Card Debt Reduction Plan. You can view and download it here: http://www.studentplatinum.com/credit-c ... n-plan.php.

Re-aging a past-due account means your creditor sets the account due date back to current. If you are a few months behind on your payments your creditor may agree to re-age your account thus wiping out those missed payments! This sounds great and it’s possible that many lenders will do this for you if you’ve otherwise been a good customer. Not all creditors are willing to do so however, and they must follow federal guidelines when deciding whether or not to re-age your accounts. Creditors may only re-age your account once in a 12-month period and twice in a five-year period for credit card accounts.

To be considered for re-aging:

* You must demonstrate a renewed willingness and ability to pay;
* Your credit card account should be at least 9 months old;
* You need to make at least three consecutive minimum monthly payments;

Creditors don’t have to re-age past due accounts and some creditors will never re-age accounts, some will only reage an account one time and other creditors follow the federal guidelines that allow once in a 12-month period or twice every five years. It simply depends on the creditor's re-aging policy.
Some creditors will re-age past due accounts if you agree to enter a debt-workout program or debt-management plan. There are thousands of credit-counseling and debt-consolidation companies looking to make a quick buck and are guilty of shoddy service and sky-high fees and others are huge scams. Be very careful of using credit services.

[Boromir]

In my opinion, the key to using credit cards is to pay the ENTIRE balance off each month. Then the selection of a credit card should be limited to those companies who do not charge an annual fee. I have had the same credit card since 1984.(Yea, I know I am an old dude) I use it often and I have never paid them any interest. Do not worry about the credit card companies, they are making money off your vendors in the form of a small cut of the price you paid the the item you bought.

I know this sounds unrealistic for those of you on a budget, but trust me do not borrow from credit card companies. That is essentially what you are doing if you do not pay the entire balance each month.
Find other sources for borrowing and maintain a zero balance each month.

"Play the float. Don't buy the boat"

[Credit Card Guy]

Boromir makes a great point. While I suspect many of the people on this board carry balances, its important to realize that when you do that you are in effect getting a loan. If your credit card has an APR of less than 5% it might be OK but few do. If its higher and especially over 10.% APR its not a great loan. Who in their right mind would knowingly sign up for a loan at 17.99% interest? My mortgage is under 6%!