10/18/2011 7:53 PM ET|
Talk your way to a better credit card
Your card's terms may be negotiable, so consider asking for changes like a lower interest rate or reduced fees. To be successful, though, you'll need to go about it the right way.
The honeymoon is over.
In the beginning of your relationship, when your credit card was all shiny and new, it attracted your attention by teasing you with a low interest rate and the promise of a lifetime of lavish rewards and lots of laughs. So you and your card hooked up, and at first, it was a match made in heaven. You took your credit card wherever you went, consulted with it before making major life purchases, and once spent a romantic weekend with it touring the Louvre and visiting the Eiffel Tower.
But lately, things have been different. You've noticed that your card has let itself go. It's put a few pounds on the interest rate and no longer seems eager to give you free airline rewards or triple points on gas and groceries. And naturally, you're wondering if there are better credit card offers out there.
It doesn't have to be that way. You can negotiate with your credit card and reclaim some of the magic. But as with any relationship, plastic or human, it takes work. So if you want to negotiate with your credit card -- OK, the credit card company -- here's what you need to know.
Ticked off because you're paying 21% and believe you deserve 12%? Don't just cold-call the customer service line without thinking things through. Calmly get out your latest credit card statement and look it over before you call.
"Know how long you've been a customer, what your current fees are and what your interest rate is," says Jim Camp, a negotiating coach in Vero Beach, Fla., who deals mostly in the corporate world and is the author of "Start With No."
"Write down some of your top benefits to the credit card company as a customer," Camp says. "For example, you are a loyal and longtime cardholder. You are employed and have the ability to pay them every month. Or perhaps you have a business account you are thinking of opening with them."
If you feel desperate, don't show it
Camp says it's important to remember that "you don't need this deal. You need water and food and shelter. Neediness is the No. 1 deal killer in negotiations. So remember that getting a lower interest rate, reduced fees or debt reduction are not life-or-death needs. Internalizing this truth will put you in the right frame of mind -- a neutral emotional state."
He advises that when you talk to a customer service representative on the phone, you should stay calm and controlled during the conversation. "As long as you can control your emotions, you will have an advantage over or equal footing with the person you're speaking with," Camp says.
Stick to the facts
You may be a good person, maybe the best out there, but credit card companies deal with numbers. "The No. 1 mistake people make is bringing emotions into the negotiation," says Matt Wallaert, lead scientist with GetRaised.com, a website that helps people with salary negotiation.
"Your sob story is not your credit card issuer's problem. They don't care about 'why,' they care about 'what,'" Wallaert says. "To them, what matters is essentially a likelihood judgment: How likely are you to repay the money that you borrow from them? So you want to address that question as directly as possible, by providing evidence that is about your repayment fitness."
But emotions can never be completely divorced from any customer service interaction. The people on the other end of the line are just doing their job. Act like a jerk toward them and you can kiss your better terms goodbye. If you're a pleasure to talk to, however, and there is some minor rule that they're allowed to bend or break, maybe you'll get lucky.
VIDEO ON MSN MONEY
Yeah, you bet your sweet bippy. Dear Sirs, I have just lost my job, no income whatsoever. My Credit Card with you has a limit of $2,500. Now that I want to spend a little more; well you know. I want an increase to $7,500. Why? You should ask! There are many usefull items at Wal-Mart that I need. I don't know when I'll be able to pay you. However, based on my good standing of the last 6 months, I think I deserve a increase. Is it in the mail yet?
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