Thursday, June 25, 2009
Should you go for the Credit Card with Best Interest Rate?
The crisis of the world economy nowadays is based on the bursting of the loan bubble. The credit card industry has been hit quite hard. I myself have been having some trouble in my credit card applications. One question that seems pertinent right now is: should one go for the credit card with best interest rate right now in this economic climate? It might be common sense for some people that the best thing to do is to get a credit card with a low interest rate, but this is not always the case. There can actually be some advantages in taking a credit card with a high interest rate.
You may not know it, but a high interest rate credit card may give your credit score a boost. For those who want to jump start their credit score, or who needs to fix their bad credit score, getting a credit card with more than 15 percent monthly interest rates will be advantageous because it will give you more points in a relatively shorter amount of time. But as you should well know, this technique is to be handled with caution. A person who has no self control with using plastic avoid getting a card with a high rate (although in some cases, a card with a high rate might just be what the doctor ordered for these people because it serves as a deterrent for their abuse of plastic as opposed to when they have a card with low rates which they would more likely abuse).
Another great advantage with a credit card that has a high interest rate is that more often than not, these have more allowance in their maximum credit. Also, a good number of high interest cards have great reward points systems as well. Thus, getting a credit card with best interest rate is not always the best choice.