How do you negotiate a lower interest rate on your credit cards?

How do you negotiate a lower interest rate on your credit cards?
Faced with continuous doubts by users about how to negotiate the interest rates on their credit cards,Hispanic Solutions Group

By Manuel Tovar, June 25 – Hispanic Solutions Group

Faced with continuous doubts by users about how to negotiate the interest rates on their credit cards, Hispanic Solutions Group, today tells you what you need to know about it.

The Credit cards they can be a convenient way to pay for things while building credit and earning rewards. However, those benefits can be seriously undermined by a high interest rate. Currently, the average interest rate on credit cards in the United States is16.15%. At that rate, paying off a balance of $ 10,000 over four years would cost you about an additional $ 3,422. An open secret in the industry is that credit card interest rates are negotiable. And today we inform you here how to do it.

The first thing you need to know is: before calling your credit card company and starting a negotiation, we recommend that you prepare in advance, then.
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Calculate your credit score

Some of the first things your company will look at credit card they are your payment history and your credit score. You can request afree annual credit report to make sure it’s accurate and to view your payment history and debt-to-income ratio (DTI).

Review the report

Checking late payments and other imperfections will give you an idea of ​​how assertive you can be in requesting a lower rate. One way to always be informed is by monitoring your credit through Credit Karma.

Collect offers from the competition

You will also want to investigate the rates offered by the Credit cards from the competition. Save any pre-approval emails or postcards you receive, or look for similar cards with lower rates to see what other offers are available. Coming into the conversation with plenty of information will give you a stronger negotiating position.

How do you ask your credit card provider for a lower interest rate?

We suggest that once you feel ready to request a lower rate, you can begin the negotiation. Here you have four steps you can take to negotiate a lower interest rate.

1.Call your card provider:Contact your credit card issuer and explain why you want an interest rate reduction. You can start by pointing out your history with the company and mentioning your good credit or your payment history on time. Now is the time to mention any lower credit card rates that you have been offered or found in your research.

2.Failure to reach an agreement:the credit card company may initially reject your request or offer a minimal reduction, but you don’t have to settle if the resolution doesn’t meet your expectations. You can always ask for more or an explanation of the decision. If you feel like you’re getting nowhere on your first phone call, be diligent. Call back at a later time and try your luck with a different representative or ask to speak to a manager and present your case to a higher authority and you may find the required positive.

3.Apply for a different benefit:If the business refuses to lower your interest rate, ask what else you could do to keep it as a customer. reps may offer you bonus points or additional incentives.

4.Request a temporary rate reduction: If you are concerned about paying a balance at your current high interest rate, request a temporary hold, which could offer you a lower interest rate for a short period of time.

Alternatives to consider

If your company credit card does not give you the reduction you expected, there are alternatives and they are the following:

1.Apply for a balance transfer credit card:Many balance transfer cards have no introductory APRs or are low for a set period, after which the APR will increase dramatically. But it might buy you some time. That said, balance transfer cards always charge a fee for transferring debt, usually between 3% and 5%, so make sure your potential savings outweigh the cost.

2. Create a debt repayment plan: start a budget (or adjust existing one) and make a plan for pay the debt from your credit card faster. If you have multiple card balances, use the avalanche method by making the minimum payment on all cards, using the additional funds to pay off the card with the highest interest rate first. Work your way down until they are all paid.

3.Apply for a debt consolidation loan:A personal loan can be a convenient way to pay off high-interest credit card debt. In the case of a debt consolidation loan, you could transfer the balances of multiple cards into a single loan with a lower interest rate.

The best advice: completely avoid credit card interest

The best way to avoid high interest rates is to eliminate the interest payment in the first place. Get in the habit of paying off your credit card balances every month, so you never have to worry about how high your interest rate is. Enroll in automatic payments to pay your balance in full each month or make payments every time you use your card.

We invite you to follow our social networks: LinkendIn, Facebook, Twitter and Instagram to find more information related to finances. Also on our YouTube channel The Credit Channel to learn how to improve your credit. If you need help in repairing your credit, disputing debts that do not belong to you, or other services, call us at (612) 216-1599.