Have you ever wondered if you could get your credit card interest rate lowered? Maybe you’ve had friends do it, or you’ve read about people who called their credit card companies and asked for lower rates… and got them. The truth is, you can sometimes lower your interest rate simply by calling and asking.
But it’s not always easy, and certainly not guaranteed!
In a previous post, we gave you specific tips for how to lower your interest rate with a simple phone call. However, today we wanted to give you a more personal perspective on how this works. So we decided to call them ourselves and report the results to you!
I called three big, national banks that I have credit card accounts with and then called some regional banks (in the San Francisco area) so I could compare the treatment I got from each bank and find out which ones were willing to lower my interest rate.
Asking National Banks to Lower My Credit Card Interest
I have to admit, when I finally sat down to make these phone calls, I got extremely nervous. Because of the fact that I’m now living in my third state in four years, I only bank with big, national banks. I need to know that I can access my money and my credit no matter where I am and bigger banks offer that convenience. But that doesn’t mean I think they’re going to treat me better!
So when I actually dialed the first bank, I noticed my heartbeat get faster and my palms start to sweat. Why was I so nervous all of a sudden? Because, in my heart of hearts, I felt no reason to believe that they would help me. Nevertheless, I picked up the phone and started making the calls – and that’s always the most important step!
Big Bank #1
When I reached the first live human and told him what I wanted – to lower my credit card interest rate – I knew I already sounded defeated. I explained everything I thought would help my case – history with the bank, good credit score, never made a late payment – and still figured I’d get a no. To my surprise he put me on hold to check out my account. I took a deep breath and felt my first glimmer of hope. Maybe he would actually help me – at least he was looking into it!
He came back after a few minutes and told me nothing was “available” to me at that time. I had no idea what he was talking about. Wasn’t I supposed to just negotiate for a lower rate? What needed to be “available”? I asked him to explain and he simply repeated himself. I very politely requested to speak with someone who could take a deeper look, and he gladly transferred the call. (One point to me for keeping calm!)
A woman came on the line and essentially told me the same thing. Again, I highlighted all of the positives about my situation and tried to find out why she wouldn’t negotiate a lower rate with me. All she did was tell me that she’s not a credit analyst – and no I couldn’t speak with one – and that I should just continue to have a good history with the bank. She did mention that they look at the entire debt picture – other cards, payment history, student loans, etc. Finally, she repeated that there were no other rates they could offer and that if I really wanted to do anything, I could do a balance transfer onto a new card. No go, I told her. The last thing I want is to open another line of credit.
I finally asked her one more time what I could possibly do to improve the chances of lowering my APR in the future. She advised that I keep making payments that are high enough to cover the minimum payment plus the monthly interest. She also gave me this little nugget of wisdom: if you pay your bill prior to the statement closing date each month, then your credit score will improve. Who knew paying a few days early could actually improve your credit score? Swing and a miss, but at least I got some good information!
Big Bank #2
By now I was feeling more confident about this situation, even though the first bank turned me down. At least now I knew it was possible to get taken seriously! I called the next bank, not expecting positive results, but at least knowing they wouldn’t think I was ridiculous for even asking. The first (and only) person I spoke to seemed to be in another country and was having trouble understanding me, as I could barely understand him. I gave him the spiel I gave the first bank and all he did was repeat the same line: there’s nothing “available” to offer me.
Why did they keep saying that? I was trying to negotiate a lower APR, not obtain a product. After pushing for more information, he continued to repeat himself as though he were reading from a script. And instead of telling me what I could do to get a lower interest rate, he told me how it could easily get higher, like if I made late payments or went over my credit limit. But what did that have to do with me? He seemed to want me to be happy with what I had and not bother trying to get a lower rate. I was too frustrated to even ask to speak with anyone else since he wouldn’t offer me any information. Another swing and miss.
Big Bank #3
Now I was getting more comfortable making these calls, and it was time to call the last big bank. I have to give full disclosure, I used to work for this bank. I had some hope that they would be more helpful since I always knew this bank to have customer service high on the priority list. However, as a lender, this bank is really tough. I even had to turn down fellow employees on many loans and credit cards when I worked there because their credit scores weren’t high enough. Those employees certainly didn’t get any special treatment for being a bank employee and I knew I wouldn’t either. (I’m pretty sure they can’t even tell from looking at my account that I was an employee of theirs.) I just hoped they would live up to my expectations.
Well, they surpassed my expectations! When I told the woman what I wanted, she immediately pulled up my account and knocked my already-low APR over two percentage points down. That was easy! When I told her how surprised I was, she said it was that easy because they were offering a promotion and that in six months my rates could go back up. Promotion? What? Again, I thought I was negotiating for lower rates. Shouldn’t that happen on a case by case basis and have nothing to do with promotions?
She told me that this bank can only lower interest rates if a promotional rate is available and then if the customer has a good profile with the bank. History with the bank isn’t everything though. Even if someone is the perfect customer with a perfect credit score, if this bank doesn’t have any promotions going on then nothing can be done.
At least now I finally understood what the first two banks were talking about when they mentioned what was or wasn’t “available” to offer to me. Another thing to note about promotions – they are available for only a limited amount of time. This means that after six months my rates will go back up and all I can do is call again and see if a new promotion is available. I didn’t like hearing this, but since credit card rates are always variable, it didn’t come as a huge surprise.
I was getting ready to thank the woman and hang up when she gave me even better news. She told me I could transfer any outstanding balances on other cards to this card that I already had at 0% interest. That’s right, a balance transfer without having to open a new card! That meant no credit check, no opening a new line of credit – just putting the balance on the card I already had. Plus, the interest rate on the balance transfer would be good until November 2013. That’s a year and a half! I haven’t even seen that long of a 0% interest rate on new cards – much less an already existing one. What about fees? The one-time balance transfer fee would be equal to what I was already paying in interest for one month on my other cards! Now, I not only got an instantly lower APR on purchases, but I was able to consolidate my debt onto this one card without having to open any new lines of credit. The whole thing was done over the phone in five minutes. Home run!
Asking Regional Banks for Lower Interest Rates
Needless to say, I was flying high by now, but my research wasn’t finished. I needed to see if I felt any different when dealing with smaller banks. Planning to contact regional banks in the San Francisco Bay Area, I found that most didn’t offer credit cards – just home mortgages and other secured loans. I was able to find local credit unions that offered credit cards along with personal banking, so that’s who I reached out to.
Small Bank #1
I explained to the first small bank that I was new to the area and looking for a place that I could open a bank account and a credit card. I even told them about my previous experiences trying to lower interest rates with the bigger banks. The person I spoke with was extremely friendly and said someone would have to apply for a credit card to get a lower interest rate than their existing rate. No thank you. If I want a lower rate and I’m a good customer, why should I have to open a new card and take the hit on my credit score?
He then told me about a product they offer that essentially pre-approves their customers on lines of credit. Every quarter, credit scores come out again, this bank sees them, and can offer more credit to customers with a high score. So if I were a customer, and my new credit score came out and proved to be high, this bank could automatically offer me the new card with a lower interest rate without pulling my credit report. I don’t consider this a perfect solution because I’d still never want a new credit card but at least I could get a lower rate more easily. However, he said the same thing as the others: if what I have is the lowest possible rate they can offer, then there’s nothing I can do.
Small Bank #2
Finally, I seemed to have a handle on all of this, so my call to the last bank was just to round out my research. As suspected, this credit union said the only way to lower an interest rate is to apply for a new card. She didn’t say anything about pre-approval though, which means I could not do this without my credit score taking a hit. This credit union also had a pretty high starting rate, so I didn’t see much reason to entertain the conversation any further.
I wanted to call a few more and see if this was the same all around but then I realized something else to consider. I work during the day, as many people do, and had to make these calls during the evenings and on Saturday afternoon. All of the big banks were available all the time (the last one I spoke to was just before 11pm on a Thursday) but only a few of the smaller banks had a customer service line that was open after hours. So there was that convenience factor again. At noon on a Saturday, all the other smaller banks’ customer service lines were closed.
All in all, I started out feeling optimistic, then freaked out before my first call, then ended up extremely happy with the results! I can now say that, although there’s no guarantee that you’ll get what you’re going for when making these calls, it’s worth the effort. I wish I had done this months ago and am kicking myself now! The only thing that gave me the guts to make the calls in the first place was the fact that I needed to do the research for this article. Otherwise, I know I never would have done it.
So don’t make the same complacent mistakes that I would have made – make the calls! The absolute worst thing they can tell you is no – and it turns out that’s not such a big deal. In fact, every bank who told me no also told me to try calling again in a few months. And besides, at the end of the day, if you have a positive result, then it’s worth its weight in gold!
What do you think of my experience? Have you ever tried to lower your interest rate before? If so, leave a comment below and tell us what happened!
This article is part of our Credit Card Debt Resource Center. If you’re looking for additional information about credit card debt, be sure to pay a visit!