How to lower credit card interest rates – can you today
reduce interest rates on credit cards? Everyone thinks it is rather easy. But really, jokes aside as it isn’t a joking matter for many, how can you get your credit card issuer to lower interest rates? There were times when all it took was a phone call and you were on a way to save hundreds or thousands of dollars in interest charges, or were they? The stories of incredible successes, few of which were true and most were pure fiction, circulate on Internet on how to get lower interest rate on credit card. Something along the lines a cardholder from Texas saw her 12.99 percent rate reduced to zero for 8 months … what a deal or a consumer managed to reduce his interest rate from 29.99 percent to 12.5 percent for a year with two phone calls. The fact of the matter was and still is that people who wrote that, never tried to reduce interest rates on credit cards themselves, but always relied on so called experts, gurus and others, who in turn, got their ideas and overly optimistic data from some surveys which were conducted by someone else.
Let me ask you a straight forward question – would you admit paying 20 or 30 percent on a credit card when someone asks you? Chances are you will be way too embarrassed and just lie. How many of surveyed people actually reduce their interest rates is debatable, but I would say not many. All you have to do is ask approach may work for very few, but will not for vast majority in current economic climate. Credit card issuers are trying to close as many high risk credit cards as they can or change the terms to make them more profitable. Among targeted are rarely used credit cards with little or zero balances, and credit cards with large balances where consumers make minimum payments. The banks close the former and entice you to pay far more than minimum payment on the latter. And no, they don’t lower those credit card interest rates. Perfect credit scores and some buying activity aren’t enough. Times when card issuers fought for good consumers are gone, gone with the wind.
So how to get lower interest rate on credit card? The only way is to ask but ask forcefully yet nicely. And still you can only hope. So the phone call which is going like this – hi, my name is Tony and I have been with you for 3 years and have 2 cards, but I just received couple credit card offers with much lower APRs, can you please reduce interest rates on my credit cards with you or else I will close them and switch … will hardly work. Your bank will likely tell you, go ahead and close if you have no balance, or pay off in full within few weeks if you carry one.
The key is to work on a credit card company fear that you will default and stop paying. Credit card debt is unsecured of course, and if you stop paying, then there is really not much it can do to you in current turmoil, except hurting your credit. So you have to strike a delicate balance between credit company desire to make a profit which it should, and demanding a much lower rate which you have no right to get, but just may anyway.
So what may work much better is the straight forward demand to lower your interest rate by at least 10 percent or cut it in half. Not only you must shoot high, you have to also explain that paying ongoing interest puts you in extremely tight financial situation and your resources are so stretched, you can not take it much longer. You must explain them that your credit rating and paying as promised are very important to you, but you need some help. If you are paying 15 percent interest, ask a card issuer if you can pay 5 or 7 percent. There is still profit to be made and you will get much needed relief. For those poor souls who pay something in vicinity of 25 percent and higher, start by asking your credit card issuers to lower interest rate to 7 or 8 percent.
Another claim made is that persistence really pays. If you are denied interest rate reductions, go ahead, try again another day and you may reach a more cooperative customer service rep, ask for supervisor or whatever. While I generally agree you must ask yourself, if you are willing to risk in order to lower interest rate on credit card, with the possibility that bank just rejects and then, in a little while forces you to play by its rules – raising not lowering you rate, or raising your minimum monthly payment from 2% to 4% to even 8% or simply requiring you to pay balance off and close the card.
Finally some phone scripts, that may or may not work in the current environment – all depends on your credit situation and how profitable your account for your credit card issuer. Bank names and rates are just for example. They are all over the Internet, with claims of instant success. Beware …
I checked with few several other card issuers, namely Chase and Wells Fargo. Both are now offering 3.99% interest rate on purchases for 12 months, which is 6 percent lower than what I’m paying on my credit card with you. Are you willing to match that interest rate? – If you have one, why bother calling, just get it.
I am preapproved for a balance transfer at 0% interest rate for 6 months with Bank of America at no transaction fees. Will you be willing to match this offer? If not I am transferring my balance to their credit card? – Again do it if you have it, but I doubt that those who really can use offer like that are getting them. And I know of few folks who lied and were exposed when asked to fax nonexistent offers to the current credit card issuers.
Can you reduce interest rate of 19.99% that I am paying now, to 11.99% that seems to be an ongoing market interest rate? HSBC, Wachovia and my local credit union are offering this rate to the new customers with credit scores of 700 and higher. Mine are 723, 741, 754. – If this is the case, go and get a bundle. I can go on, but the bottom line is times have changed drastically, be careful what you wish for.
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