Asking Credit Card Companies for a Lower Rate Could Hurt You

In the old days, if you were hit with a credit card rate increase you could call and threaten to take your business elsewhere; that was then, this is now. Today, consumers calling in to negotiate a lower credit card rate could be putting themselves at financial risk. That’s because credit card issuers are extremely worried about extending credit in this turbulent environment, and even grade ‘A’ customers have seen their rates increased for no reason at all. A call to a credit card issuer could put you at risk for a “credit review,” as credit card companies view a rate negotiation as a potential sign of trouble – and they’re not taking anymore chances.

Beware the Credit Card Review

If credit card companies decide to put your account on review and don’t like what they see, you could be facing a rate increase, a lower credit limit and possibly even a closed account. You’re essentially putting yourself on their radar by calling in. If the current credit card legislation working its way through the Senate is approved however, you won’t have to worry about these unfair practices occurring in the future.

Biggest Credit Mistakes

The biggest mistakes consumers make when calling in and questioning their credit card rate increase is arguing with the representative. Instead of demanding things, you should instead request a rate drop or simply ask why your rates have gone up. Being polite can go a long way. Angry consumers who cancel their credit cards or opt out of rate increases are only hurting their own credit score. That’s because your credit score is also determined by the overall amount of credit you have available; if one line of credit is suddenly closed, it will negatively impact your score.

Good Credit History

But not everyone should be afraid of calling in. If you’ve paid your bill on time each month, have a good history of credit usage and have a great credit score, there’s no reason a call could hurt you. Don’t know your credit score and what’s on your report? Check with Go Free Credit for free. Many times, credit card companies will be willing to drop your rate again if you are a responsible customer. For those of you who have less than perfect credit and saw had your rates increased, your best bet would be to accept it and pay off your debt as quickly as possible. If the interest rates are breaking you each month and you absolutely must try for a lower rate, remember to be professional and tactical in your approach. Explain your situation openly and honestly and you may be able to get that lower rate.

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Have you had a bad experience after calling in to a credit card company, or have you ever successfully negotiated a lower rate on your credit card? Please share your experiences with the Go Banking Rates community.