Negotiating a Better Credit Card Offer

Credit card customers can often get more from their credit cards than they start out with. Especially for credit card customers with a good credit rating, cards with better interest rates, rewards points, airmiles, perks and no annual fees can be theirs merely for the asking.

While people with bad credit are never in a good position to negotiate with credit card companies and must accept whatever types of card they are offered, the opposite applies to those who have maintained a good credit score. A person with that good score is in a position to tell the provider what they want and expect from their cards.

Gather Your Ammunition for Credit Negotiation

Before you start your negotiations for a better deal on your credit cards, you will need to gather all your information together and determine what exactly you want to ask for. There are a few things you should do in preparation before you actually call Visa, MasterCard or American Express and ask them to sweeten your deal.

1. Get a credit report. Get an updated credit report from the reporting agencies (Equifax, TransUnion and Experian). You can also go online to www.myFICO.com to check out your current credit score. You should know what your rating is so that you can properly negotiate using your good standing as a bargaining chip.
2. Research the market. Now you should find out what is currently in the marketplace for good credit card offers. You will want to compare credit card offers from a wide range of providers so making a simple spreadsheet is a good idea. Give yourself some columns to mark down interest rates, rewards, cash back, no annual fee and any other perks that you want to compare. A column where you can make note of balance transfer credit card offers is a good idea as well. Columns that list the introductory interest rate on the balance transfers and how long that low rate lasts as well as the higher rate that the card switches to after the introductory period will help you determine whether such credit card offers are good for your personal situation.
3. Interview Yourself. Now you will need to compare all the information you have gathered and find out what it is you really want the most from your credit card company before you move on to the negotiations. What is important to you? Do you travel a lot? If so, do you want to build up travel points when you use your card? Would a cash back card be helpful to you? If you carry a balance on your credit card, you may want to focus on just getting the lowest possible interest rate card you can and not worry about other perks.

Go Forth and Negotiate with the Bank

Now that you have armed yourself with information and have a good idea what you want from your credit card company, you can ask for it. If you don’t ask you simply won’t get it. A survey done in 2002 by the U.S. Public Interest Research Group stated that over half of the people surveyed received lower rates by asking for them. You can do this too.

Many front-line responders at the call centers are trained to say “no”. Your first answer may indeed be that blunt. But, remember that you have the information and you are ready to negotiate. If the first person you get on the phone is unwilling to be of any help to you, try calling back a little later to get a more helpful agent. Ask (politely) to speak to a manager if you do not get a willing agent on the phone. Use the information you have gathered and remind the manager that there are other credit card companies that have great offers and you may transfer you business to them if you cannot get a better deal with your current card. Be firm but polite and business like in your conversation. Remember this is a negotiation, not an argument.

The fact is that credit card companies do want new customers. This is why most of them have good credit card offers out there. Just because you already have a card does not mean that you should be stuck with outdated and unrewarding terms.

Some credit card companies will gladly give you the terms you want but they will need to issue a new card in order to do it. Be prepared to go through a little paperwork with them to get this done. If this is the case, be sure to ask that your old card be cancelled as well so that you do not have an open card that is unused (this can affect your credit score).

Terms you can generally negotiate:

• Interest rate
• Annual fee
• Cash back
• Rewards and points
• Balance transfer fees