5 Top Reasons Why Your Credit Card’s Interest Increased

Jan 19, 2021

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Table of Contents

The Introduction

5 Major Reasons

  1. Linking of Your variable APR to the Prime Rate
  2. Ending of the Promotional Rate
  3. You Missed Two Payments In A Row
  4. A Drop In Your Credit Score
  5. Card Usage For More Than 12 Months 

The Take-Away


The Introduction:

Not very long before, credit card issuers were able to increase interest rates for the consumer whenever they wanted. As a result of this, much distress was caused to the cardholder. In the world of credit score restoration, there was a fortunate moment in which the introduction of the Credit Card Act of 2009 came into being. This put an end to such unfair practices when it comes to credit card interest rates.

Having said that, there are certain special circumstances under which your issuer could, nevertheless, easily increase your interest rate on the credit card. Some of those circumstances are as follows:

5 Top Reasons Why Your Credit Card’s Interest Increased

5 Major Reasons:

  1. Linking of Your variable APR to the Prime Rate

The prime rate is exclusively dependent on the decisions that are made by the Federal Reserve hence, the increase or decrease takes place accordingly. For most consumers, credit card interest rates are linked to the prime rate. As a result,

when the prime rate rises or falls, the interest rate of the cardholder increases or decreases as well. To keep things in order and stay away from the low graphs during the credit score restoration process, it is important to keep an eye on news relevant to the changes in the prime rate.


  1. Ending of the Promotional Rate:

When it comes to financing a big purchase or to pay off the existing card’s balance, the majority of consumers use balance transfer cards. These cards offer low-interest rates (often 0%) which last anywhere between 6 – 12 months, for a promotional period. When this period is often, you see a kick in normal credit card interest rates.

It is totally up to you as the cardholder, to stay alert and pay off the balance prior to the expiration of the promotional period. On the other hand, also try to pay elevated interest on the existing balance.


  1. You Missed Two Payments In A Row:

In case of paying your credit card bill 30 days late, the late payment fee will have to shell out. Like you suffer credit score damage during the credit score restoration, damage in credit card interest rate is the same phenomenon.

On the other side, if you are 60 days late, your issuer has the authority to raise your interest rates. The bad part is, this increase may not go away until you have successfully made at least six consecutive payments perfectly on time. Bad enough, right?

An important point to keep in mind is that the issuer can raise your interest rate only when you have defaulted on a card that was issued by the same company. In simple words, an issuer is not allowed to raise your rates if you have defaulted on a card that was issued by another company. This is because the practice of universal default has now been banned in credit card restoration.


  1. A Drop In Your Credit Score:

Your issuer has the complete right to keep a check on your credit score, from time to time. If the company finds out that your credit score has dropped substantially, they have the authority to raise your credit card interest rates; on a  45 days’ notice provided before doing so.

Once the consumer receives the notice, he or she has the option of paying off the existing balance and easily closing the account. In case he or she plans to continue using the card, this indicates that they have accepted the new rate.

However, in this case, the issuer has to review your score again after a period of six months. If the score has gone back up with the help of the right credit score restoration program, the company has to consider lowering your interest rates


  1. Card Usage For More Than 12 Months: 

If you’ve had the card for less than 12 months, the credit card company has no right to change your rate. This is ordered by the law- unless you have missed any payment. Once the 12 months period is up, the issuer is then allowed to raise your credit card interest rate.

If your case is similar to this one, it is suggested to always try and find out why the provider company is increasing your interest rate. If the increase is due to some reason that can be fixed from your end, raise an error on your credit report and later on, take the right step to correct the error.

The Take-Away:

An increase in the credit card interest rate can be very harmful to the cardholder in various ways. This can result in different problems such as:


  • Elevated interest payments
  • Increased Debt levels
  • Major credit score damage
  • Difficulty in accessing new credit


Due to these reasons, it is highly suggested to remain alert and try to avoid such situations that can lead to high interest increases. A missed payment is one of the biggest causes.

However, if you make on-time payments, then the credit card interest rate increases due to unavoidable circumstances. This includes:


  • Prime rate hikes
  • Errors in your credit report


One of the best things you can do if you are dealing with the wrong credit score restoration or increased interest rates is to approach a reliable team of experts. The team working at WealthBuilders365 is the one you are looking for!

We offer individuals with good credit scores the life-changing opportunity to get up to $50,000 of unsecured credit at 0% interest. This is available for various time periods and the amount can be used for anything – ranging from funding a small business to providing a down payment on your dream property.

If you know someone who needs this type of financing for a better life, have them call us at (800) 410-9330 or visit

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