Are Interest Rates Charged Closed Credit Cards?
It’s the duty of credit card companies to usually charge an interest every month on previous balances when a credit card is open. The question now is if your card company will still charge interest when you close your credit.
It’s your decision to decide whether to close your credit card with balance or to leave it open, but the fact remains that even when you close your credit, you’re still expected to make the payments of interest charged on you. Let’s assume this interest are not charged when u close a credit card with balance then people would use that opportunity to close their cards simply to avoid paying interest. Note that you’re still expected to pay the interest until you reach a zero balance.
Closing a credit card, what it really entails | Are Interest Rates Charged Closed Credit Cards?
The closing of your card does not have any effect on the terms and conditions of the credit. It simply means that your monthly bills of finance charge will still be charged when you have a balance. Usually, this finance charged is normally calculated based on the balance you have and your interest rate.
Beyond closing of your credit, transactions or any form of purchases will not be accessible which is one of the negative effects of closing a credit card. Also, access to credit limit will no longer be granted.
Paying the minimum payment as at when due is still your responsibility until you’ve paid off your balance. Note that late payments fee will be charged when you fall behind in payment or paying less than the original amount you’re to pay.
You can totally avoid Interest charges on your closed credit card
The total avoidance of paying interest on closed credits is very much possible, as there are a number of ways to do so.
One way to avoid paying interest on closed credit is by sending or transferring your left balance to your other credit card. After each promotion expires, you will be mandated to pay any balance remaining so ensure you make payments before the end time of your cards promotion.
Before you close your credit, have an agreement with your card company about a reduction in the interest your card company and request for a reduced interest rate.
Are Interest Rates Charged Closed Credit Cards?
Another way you can eliminate interest charged on closed credit is to make more payment on your credit card, the number of transactions you engage with your card should be more. By doing this, your balance is reduced and the lower your balance the lower your finance charge will be.
