One age-old tactic for reducing credit card debt and reducing your payments is to ask your credit card company to lower your interest rate. But in a time of rising interest rates and high inflation, you might think asking your lender for concessions would be a waste of time.
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However, a new study shows that it pays to call. Personal loan specialist LendingTree found that 70% of requests to credit card companies to lower a borrower’s APR were approved in the past year.
If you call your credit card company asking for help with your debt, what can you ask for?
- Lover APR.
- Waived the annual fee.
- Balance transfer fee waived.
- Different term.
- Higher credit limit.
- Late payment fee waived.
Based on a LendingTree study, 70% of lower APR requests are approved. Meanwhile, if you ask for a waived or reduced annual fee, a late payment fee waiver or a higher credit limit, your odds of success jump to more than 80%.
Any of these concessions can save you money immediately or in the long run. If you apply for a higher credit limit, you’ll have an 84% chance of being approved. A higher credit limit could help boost your credit score, since your FICO score is based in part on your debt-to-available credit ratio. As long as you don’t run up more charges on your card after receiving the increase, you may see your credit score increase. In turn, this could lead to lower interest rates in the future.
To increase the odds of your credit card company approving your request, be sure to ask nicely. If the first person you talk to says no, you can ask for a supervisor or manager. If you’ve recently improved your credit or have a long history of paying on time, point that out to a customer service representative.
It may help to prepare a script in advance to ease the nervousness of presenting your case. If all else fails, call again another day. You may get another representative who would be more willing to help you.
You also have a better chance of success if you have some leverage. In other words, if you have another card available and are willing to perform a balance transfer, you can notify your credit card company. They may lower your interest rate and/or waive fees to keep you as a customer.
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More: How the Credit Card Competition Act would affect you
Remember, every dollar you save in the new year can help you build a stronger financial future. Lowering your credit card payments while paying off your debt even faster can make a big difference.
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This article originally appeared on GOBankingRates.com: Want to lower your credit card APR? Consider simply asking (you have a 70% chance of success)
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