Smarts on Obtaining Better Interest Rates

Sylvia Lim CGA, CFP

Here are some tips to ensure you’re tapping into the best possible interest rate available for your next mortgage, car loan or credit card.

Pay your current bills on time.
Late payments reflect badly on your credit history. Credit granting institutions will add a premium to your borrowing rate to compensate for your account’s higher credit risk.
Close off unused or unnecessary credit card accounts.
This is because too much available credit harms your credit rating, even if you don’t fully utilize it.
Comparison shop for a better rate.
Don’t settle for the rate initially offered to you. Comparison shop with other credit granting institutions. Use the service of a loan/mortgage broker.
Don’t forget to ask for a better rate.
Always ask. The worst is they’ll say ‘no’. The best is they’ll agree to a better rate for you!

Credit history review

Regular monitoring of your credit report with the three major credit agencies is necessary to ensure your credit history is accurate. This is because:
Any inaccuracies may affect your good credit rating;
Same named person’s negative credit information may have been accidentally included in your report;
Someone may have stolen your identity and systematically destroyed it.

Notify the agencies immediately if you notice any inaccuracies. Follow up to ensure they are corrected.

The Three Major Credit Agencies

In the US:

In Canada:

Find more saving and finance tips in Sylvia’s books