Consumers with high credit card balances and interest rates certainly pay a significant amount of monthly interest. However, they can save hundreds or thousands of dollars by requesting an interest rate reduction, according to Bankrate financial columnist Lucy Lazarony. More money is applied to the principal if the rate gets lowered. Lazarony explains that it helps to know what to say when asking credit card companies for a reduction.
Preparation
BCS Alliance recommends writing a script for each credit card account, customizing them with specifics for each card. For example, refer to the length of time the account has been open for older cards. Include the perfect history on accounts that have never had a delinquent payment, and note that a particular card's interest rate is not competitive, if most other banks have lower rates.
Identification
Card holders should know what to say to identify the person who can grant interest rate reduction requests. The Motley Fool financial website advises using the customer service phone number printed on the card, bank website or account statement. Select the correct options to reach a live person and ask the agent, "Do you have the authority to grant interest rate reductions?" If not, ask to be connected to the right person. Otherwise, launch into the request.
History
Tell the customer service agent about the account's positive history, the BCS Alliance recommends. Credit card companies usually want to retain good customers, so long-time account holders have an advantage in interest rate negotiation. For example, say, "I have had this account for five years and have never made a late payment. I hope you want to retain a good customer like me." Emphasize other positives, too, like, "I have never gone over the credit limit" or "I always pay more than the minimum."
Considerations
Banks sometimes turn down rate reduction requests, even for good customers. Motley Fool advises calling and asking again in a few months. Say the same things you did in your earlier rate reduction requests. It may take time, or speaking with several different agents, to finally get a lower interest rate. BCS Alliance recommends asking for a supervisor if an agent refuses to lower the rate. Say, "Can I please speak to someone with more authority?"
Alternative
People with good credit who cannot get rate reductions can often get better terms with new credit cards, according to Howard Strong, author of the financial guide, "What Every Credit Card User Needs to Know." Their current card issuers may even grant a rate reduction when faced with account closure. Ask to speak to an agent who can close the account and explain the reason, such as, "One of your competitors is giving me a card with a rate three points lower than yours." The agent may give a better offer to retain your account.
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