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Bigger banks offer worse interest rates, new study shows

CHARLOTTE — A new federal study shows large banks are offering worse credit card interest rates than smaller banks and credit unions -- regardless of how good or bad your credit is.

The Consumer Financial Protection Bureau says the 25 largest credit card issuers charged customers between 8 to 10 percent higher interest rates than smaller companies.

In dollars and cents, the Bureau says this can mean $400 to $500 more to the average cardholder each year.

The agency plans to keep studying the issue.

In the meantime, Action 9′s Jason Stoogenke offers this advice to confront credit card debt:

  1. Don’t be afraid to negotiate. See if your credit card company will give you a better rate.
  2. If you have a major purchase coming up, you may want to open a new credit card, one offering 0% interest. Just make sure you read the fine print.
  3. Consider consolidating your debt with—what’s called—a “balance transfer” credit card.

But a few words of caution:

  • Usually, you need good credit to qualify for these cards.
  • Most of these cards charge a transfer fee.
  • The interest rate will go up after the promotional period ends.

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