How to Get a Better Interest Rate
So you've got a few credit cards, and you're quite happy with
them overall. Still, wouldn't it be nice to save a little money
on interest? It all adds up over time, and more quickly than
you'd think. If you're a good customer, you'd be surprised how
easy it is to get a better rate. Make the call. A five-minute
phone call to your credit card issuer could save you hundreds,
even thousands, of dollars in interest charges. A lower interest
rate on your credit card account could be yours just for the
asking. Read on.
Pay on Time, But Not the Entire Debt
The most desirable customers for the credit card companies are
the ones who make a payment on time every month - but don't pay
off the whole balance. After all, running no balance every month
means that you pay no interest, and the company makes no profit.
If you keep up the pattern of running a relatively small balance
each month, then the companies will start falling over
themselves to offer you better interest rates.
Threaten to Go to Their Competitors
Have you ever noticed lately that it seems like every company
offers a credit card of some sort? That makes the credit card
industry extremely competitive. Collect ads and offers for
better rates than your company has given you, and then phone
them up and tell them all about it. A good rouse is to start the
conversation like this:
"Them: Hello, what can I do for you today? You: Oh hi, I was
just calling to ask if there's anything that you need to do to
transfer my balance to this new card I'm getting? Them: Well...
may I ask what card that is? You: Oh, I got the offer in the
mail this morning. [Tell them all about the great interest rate
and everything. You could even make things up - they won't
know]. Them: And you've accepted that offer? You: I'm just about
to, yes. Them: Well, hang on... we might be able to offer you a
better rate on the card you've got..."
The trick is in getting the company to think you're just another
fool who responds blindly to advertising, and they're in danger
of losing you as a customer. Don't whine about how you're such a
good customer - they already know what kind of customer you are,
but they definitely want you to stay their customer.
A fun alternative is to phone your current company, get an offer
from them, and then phone around more and try to get them to
beat it. Once it's beaten, call your company back and let them
know.
Drive a hard bargain, and be prepared to walk away (well, hang
up). If you turn down their so-called 'best offer', hang up and
wait half an hour, there's a good chance that you'll get a call
offering you a better one!
It isn't just on credit card companies that these tricks get
results. It works because it costs a company so much to get a
new customer (the 'cost of acquisition'), and so it's cheaper
for them to offer you a better deal, just to keep you. Try it
with your Internet Service Provider (ISP) sometime.