Dear Liz: I’m frustrated. A Visa card we’ve had since 1996 now has an annual percentage rate of 18.24%. When I questioned the card issuer about it, the phone representative blew me off, saying it’s automatically reviewed and adjusted every six months. We paid it and our other credit cards off two years ago. Our only debt is our mortgage ($179,000 on a $500,000 home). I went to MyFico.com and found one of my FICO scores is 801. What’s wrong with this picture?
Answer: It’s not entirely clear why you care what the interest rate on the card is, if you’re not carrying a balance. Whether the card charges 18.24% or 1.824% makes no difference to your bottom line.
If you’re objecting on principle, you should know that credit card companies can charge pretty much any interest rate they want. The good news is that you have plenty of options if you want a card with a better rate. The average credit card interest rate is somewhere around 16%. Many issuers offer single-digit teaser rates to people like yourself who have high credit scores. You can check out sites such as CardRatings.com CreditCards.com and NerdWallet.com to find lower-rate cards.
Since your issuer refused to lower your rate when asked, it either doesn’t think you’ll bolt to another credit card company or doesn’t care if you do.