Credit card debt? It's not the plastic in your hand that's the problem - it's the interest rates that drain your wallet. A poorly managed account balance with a double-digit interest rate can evolve from what seemed a minor purchase, into a financial Black Hole that could take years to dismantle.
Those pesky high-interest rates aren't a mandatory part of the credit card experience! You can negotiate for lower rates, so long as you know the right people, and the right way to ask. A quick call, maybe 15 to 20 minutes, could end up saving you a small fortune in the next year.
Stepping into the battlefield against your credit card debt? Even a small reduction in your card's annual percentage rate (APR) can significantly narrow down your debt-payoff timeline.
Consider this: a $10,000 balance on a card with a 25% APR could cost you $2,500 in interest. Lower that APR to 15%, and save $1,000 in the next year alone. That's a giant step closer to financial freedom. A little bit of negotiation can take you that much closer to your goal.
Sounds too good to be true, right? It's not. The odds are in your favor, with little risk involved. Negotiating your APR won't be reflected in your credit report and unlike other methods of dining down debt such as debt settlement, you won't need a professional on your side. It might surprise you to see how easy it is to get your rate reduced.
You might be intimidated to negotiate with your credit card company, but keep in mind, you’re one of its best customers! You've given this company the opportunity to profit from your interest payments. This is a power you can leverage.
Credit card companies have zero desire to lose you or your balance, especially when they're earning returns higher than the stock market. The more you spend, the better for them. They'll likely go the extra mile to keep you content and spending. Your most potent weapon is the mere possibility of walking away.
Worried about how to talk to credit card companies about lowering your APR? It's not that challenging, and it certainly doesn't require an MBA in negotiation.
Appraise your situation first. If you have a strong credit score, look for competitive offers from other credit card companies. Show your current card provider that you're willing to switch if they don't budge.
Getting these offers is as easy as going through your mail. Among the pile of envelopes, you'll likely stumble on balance transfer offers from other credit card companies promising lower rates if you transfer your balance to them.
Take the bull by the horns and call your credit card company. Keep it straightforward and mention the competitive offers you’ve gathered. Let them know that you'll consider switching if they can’t offer you a lower rate.
Be persistent and don't accept no for an answer. Ask to speak to their supervisor if they aren't helpful. Requesting their details can also come in handy, as they usually hasten the transfer to a supervisor.
The supervisor is usually the right person to handle your request. Explain your situation with a hint of flattery about your experience with their company but emphasize that you would like a lower rate or else you might consider leaving. You have at least a 50% chance of having your request accepted. Even a partial reduction from a competitor’s rate could save you a lot of money.
If successful, ensure this new agreement is confirmed in writing to avoid any future miscommunication. Then use the money you've saved to reduce your credit card debt or other outstanding debts further. Don't let this be an opportunity for frivolous spending!
Determined persistence goes a long way. Ask about their rate reduction procedures and if there is a time frame for consideration. If they aren't willing to cooperate, consider switching to a better offer available elsewhere, possibly through balance transfer promotions.
Your debt is actually a valuable asset to your credit card company. They need you to maintain their profitable return rates. Be direct and ask for their help in keeping you as a customer. Many credit card users have seen success with this approach, and you could be next.
Worst case scenario – if your credit card company refuses to lower your rate, check out the balance transfer offers you've gathered. Choose from among the best available, and this could be your ticket to huge savings.