Getting better, cheaper credit--right now! by Scott Bilker

Believe it or not, I know people that have revolving credit-card debt in amounts of $6,000 or more with rates over 20% and they're not interested in getting a better rate. That's just crazy!

The first defense against being gouged for high rates and fees is finding new creditors. During radio interviews, I'm frequently asked how many credit cards I have. Don't be alarmed…I manage over 80 credit cards in my household, most of which have no balances, however, keeping the accounts open gives me more options.

Now many of you may say, "Scott, why should I listen to a guy who has so many credit cards. What would you know about getting out of debt?"

Who would you rather ask? Someone who's had no credit cards since 1965, or me, who's always using credit-card deals, calling banks, and reading the fine print in all the mail offers? Plus, I like to have options when I shop for a loan, which is why I always have low rates and low-rate offers. All my credit-card banks are fighting for my business. The only catch is that I must be responsible with my credit card spending and usage-no problem, I just keep all the cards locked away at home.

I'm not suggesting that you, or anyone, should have 80 credit cards. You need to have discipline and good credit/debt management to handle that many accounts. You can't buy what you cannot afford to repay. Almost all of my accounts have a zero balance. I carry two credit cards in my wallet and the rest are in the "credit-card graveyard." That's the file where I leave all these zero-balance credit cards until I need to borrow money. At that time I exhume the cards and give each bank a call.

Another great benefit from having many cards are the credit-options that come with responsible usage. I always have low-rate offers on nearly half of all these accounts-all the time! That means I don't have to shop for too long to find a great deal. Let's look at how much you can save when you take advantage of a relatively common credit-card offer-2.99% for 6 months.

Many times you'll get a balance transfer offer and it will show a table of savings in the letter. The table will compare how much you owe now, at your current rate, with the transfer rate and then show you the dollar savings. Well, you can't calculate the true dollar savings unless you also know the amount being paid per month.

With that in mind, here are the true numbers. Say you have $5,000 right now, on a credit card, at the national average credit-card interest rate of 18% APR. Let's also say that you're making payments of $105.00 per month, which at that rate will take 7 years to repay.

Suppose you get a new credit card and transfer that balance to 2.99% APR for only six months, then the rate goes back to 18% APR. If that's all you did to save money on this debt, then by the time the debt is paid off you'd have saved a total of $1,107.00! That's right, all from that one-time 2.99%-for-six-months balance transfer. Boy is that worth it!

Now, let's say that you get a credit deal with 2.99% APR for six months and after that it's fixed at 9.99% until the balance is paid. The savings over the life of the loan from taking advantage of this offer are $2,707.00. Amazing how much money this single offer can save.

That's why switching from your current credit-card bank can be good idea, and in this case, a $2,707.00 idea. But it's not over…something magical will happen. The first bank, the one you transferred the balance from, will start sending you very attractive low-rate offers. After a while those offers may get as low as 0% as they beg, beg, beg, and beg some more for you to come back.

There was a time when my friends told me, "Scott, new credit card banks are going to turn you down when they see that you have so many credit cards!" Duh, if I have a ton of credit cards already then why would I need more? Well, just to prove them wrong I applied for every credit card offer I received by mail.

What happened?

I received one out of two that I applied for. That's half of all the applications that I sent in. I eventually had to stop applying because they just kept on coming. Then some people said, "Well, Scott, the only reason you were able to get so much credit is because you have a great credit history." Yes, it's true that my credit history is good. That's why I wrote, Credit Card and Debt Management, because I want everyone to know how easy it is manage debts and receive great credit deals that save thousands of dollars!

The bad news is that if you've made mistakes handling your credit in the past, those mistakes cannot be removed from your credit report. Eventually, depending on what the "mistake" is, it will be removed with time. The good news is that if you start better credit management today, it won't be long before you begin getting those good credit offers. Banks are always searching for new customers and even after a bankruptcy, decent credit offers start to become available within three months of improving credit management.

There is a list of banks on the right side of this article. If you're looking for a new credit line then this is a good place to start applying. Make sure you read all the fine print to determine if the offer is good for your situation. The best part is that you can apply for these cards right now online.

Good luck!