When it comes to paying credit card debt, your interest rate is always important. Maybe you opened your account at a time when your credit wasn’t the greatest and even though it’s better now, you’re probably still paying a higher rate than needed. The average credit card APR is currently between 17 and 24 percent and is still rising, so it’s important to get that lowered as soon as possible. These are a few tips if you’re looking to negotiate a lower interest rate.
Do Your Homework
Lowering your interest rate is never as simple as you’d like it to be, and you’ll likely have to negotiate for it. Luckily, you have an advantage in that your credit card company wouldn’t be happy about losing a customer. Knowing your existing balance as well as the amount of interest you paid in the past year is the first thing you should do. If you have this information in your corner, you’ll have an easier time convincing them that they should offer you something better. Another great tactic is to research other lower-interest rate cards that are currently on the market so you can reference other offers you’ve received.
Improve Your Odds
Since credit card companies often don’t enjoy losing customers, you might think that’s all you need on your side. The issue is that sometimes a company might not consider you a good enough customer to consider what you’re asking. You may have a rocky history as a cardholder and it could be a good idea to take a step back and see what you can do to improve your odds. It’s important to think about if you have a strong credit score. Good credit is a sign that you’re skilled at handling debt and will likely continue handling it properly. Beyond credit score, they’ll also look to see if you have a long history of making your payments on time.
Just Call and Ask
You’d be surprised how easy it is to pick up a phone, call your credit card company, and just ask them about lowering your interest rate. Once you’ve prepared for negotiations and feel you can properly display your value as a customer, give them a call and see what happens. It’s okay if they reject you. Try hanging up and calling back in hopes of getting a different representative. You can even try asking for a manager, as they typically have more decision-making power and might be able to help you out. If in the end you’re denied, you can most likely still work something out. There are plenty of temporary or promotional rates that they may be able to give you. If they continue to not budge, let them know that you’re willing to close your account once you’ve paid your balance off so you can go to a competitor. If you can mention a specific competitor, that might be exactly what you need to persuade them.
Negotiating a lower interest rate isn’t always the easiest thing to do, but it’s far from impossible. If you do your research, you can likely get a good deal out of your current company. If all else fails though, there are plenty of other options out there. If you’re really aching for that lower interest rate, pick up the phone and call your company. You will likely not regret it.
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