So you’re wondering if you can negotiate with your credit card company? The short answer: it depends.
Credit card companies may negotiate on some things — credit line increases, due dates and even minimum payments. But other things — like special offer terms — aren’t really negotiable. The key is understanding what you can negotiate on, as well as how to negotiate.
What Can You Negotiate?
Credit card companies are surprisingly open to negotiate on a number of issues. This is especially true if you’re a customer in good standing — if you’ve made consistent on-time payments and haven’t charged more than your credit card’s limit. Here are some of the things credit card companies are often willing to negotiate on.
Payment due date. Your due date is typically automatically set when you get approved for your card. But if a particular payment date isn’t working well for you, ask to get it changed. Some credit card companies are so flexible about this that you can just change your due date online. (Just be sure you know which billing cycle the due date change will affect.)
Interest rate. Let’s say you’ve had a credit card for a few years. When you first signed up, you had mediocre credit. Now, you have much better credit, a low balance, and you’ve made on-time payments for years.
The credit card company probably won’t just hand you an interest rate reduction on a silver platter. But you can ask. And, chances are that if you mention that you found a better interest rate deal elsewhere, the company will reduce your interest rate to keep your business.
Credit limit. Again, if you’ve been a customer in good standing for a few months or years and have made your payments on time, you may be able to get a credit limit raise. Even if you don’t plan to use the extra credit, the more credit you have available, the better your credit score because your ratio of debt to available credit is a big factor in your scores.
[Editor's Note: If you want to see where your credit currently stands, you can check two of your credit scores for free every month on Credit.com.]
Annual fee. Annual fees are often waived for new customers, but getting an annual fee waived after you’ve been a cardholder for a few years may be a bit more difficult. That doesn’t mean it’s not worth the effort though — many issuers would rather keep you as a client and waive a fee than lose you.
Minimum payment. If you’ve fallen on hard times and can’t afford your credit card’s minimum payment, don’t panic. Call your credit card company immediately. Tell the representative about your situation, and see what the company will do for you. Often times, in cases like this, you may be able to negotiate a lower minimum payment. That way, you can stay in good standing without breaking the budget.
Late charges. Forget to make one credit card payment on time? Many companies will forgive the (often hefty) late charge fee once every year or two. As long as you aren’t in the habit of making late payments, you could get the benefit of the doubt.
Long-term repayment plans. If you’re in really bad financial straits, talk to your credit card company about a forbearance agreement or a long-term repayment plan. The first will keep you from having to make payments for a set period of time. The second could let you pay your debt back with reduced or no interest.
Lump sum settlements. So what happens if you’re literally on the verge of bankruptcy? Well, your credit card issuer may let you pay off your debt for less than you actually owe. A lump sum settlement payment can actually save the company money in the long run. Once you’ve been behind on payments for months and are leaning towards bankruptcy, you can negotiate to settle your debt — sometimes for pennies on the dollar.
How Can You Negotiate?
Exactly how you negotiate with your credit card company will depend on your circumstances. The first step is to just ask – especially if you’re asking for something small, like a due date change. Just call the company and say, “Hey, my paychecks come in on the 15th every month, so I’d like to change my due date to the 20th.”
But if you’re dealing with bigger asks — like a significant credit line increase, the waiving of an annual fee, or other issues — take these steps.
1. Figure out where you stand.
First, know where you stand as a credit card customer. You’ll be more likely to get what you want if you’re a good customer, which means two things: you make payments on time and you make the company money.
How do you know if you make the company money? Well, you either pay finance charges because you carry a balance from month to month, or you use your card frequently. Using your card frequently makes the credit card company money because it gets an interchange fee on every transaction.
On the flip side, you’re more likely to negotiate for dramatic changes — like a lump sum repayment at a reduced cost — if you’re having difficulty keeping up with your agreement. Maybe you haven’t made payments in months, and aren’t improving financially. In this case, the company may just want to cut its losses, so your offer for a lump sum repayment or a reduced rate long-term repayment plan may look more attractive to them.
This is why many debt settlement companies will tell you to stop making payments on purpose. It’s scary and counterintuitive. But if you decide to work with one of these companies, you may have to take this route.
2. Speak with a manager.
As soon as you get on the line with a credit card company representative, ask for a supervisor. That original rep you talk with can probably unlock your online account when you’ve forgotten a password or enter an address change. What s/he normally cannot do is reduce your interest rate or change your repayment plan.
So skip a few minutes of meaningless conversation by politely asking for a manager as soon as you can.
3. Be persistent.
If you’re asking for credit card changes — especially big ones — you may need to be persistent.
When you’re coming from the position of a customer in good standing, you may get further faster if you have leverage. For instance, look up competing credit card offers and tell the issuer you’re considering moving your account or transferring your balance. That may be enough to get them to cooperate.
Negotiating with a credit card company won’t always have the outcome you want. But it sure doesn’t hurt to ask — and even to get a bit aggressive.
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