For many years, I have had three major credit card accounts. The other night I was reconciling my monthly statements and noticed a large discrepancy in the annual percentage rate (APR) I was paying on these three accounts.
My first card, “Card A," has an APR of 8.9%; “Card B" has an APR of 9.9%; and “Card C" has an APR of 17.9%---Ouch! I knew I had to see what I could do about this "out of range" interest rate on “Card C." So I considered a couple of options.
One choice would be to transfer or switch the balance on “Card C" to a new card with a lower APR. This would be very easy to do since I had received several pre-approved credit card offers earlier in the week. They included "convenience checks" that I could use to payoff that high APR credit card, thereby transferring that balance to a new account.
This option, however, was decided against because I didn't really want to add another account to my credit profile. My credit score, that "magic number" that establishes my credit-worthiness to merchants can be affected negatively by having too many accounts.
Calling For A Better Rate
So instead I decided to contact the issuer of credit “Card C" to see what they could do about that 17.9% APR. I reasoned this was the better of the two options since I've already established a relationship with this company; a relationship which included many years of on-time payments which reflects positively in my credit profile with the credit bureaus.
I called the 800 number and talked to a very a nice gentleman. I explained to him the reason for my call; two other credit card issuers offered me a much more reasonable interest rate, and so I'd like to see what his company could offer to me.
I wasn't surprised when he replied that he could lower my current rate from 17.9% to 15.9%. Since the credit card company makes a profit from the interest rate they charge I didn't expect to be offered the best or lowest rate right off the bat. I prepared myself to have to do a little negotiating.
Good History? Time to Negotiate
I reminded him that my account was in good standing and had been for many years. I had not made any late payments and always made more than the minimum payment due.
Again he told me that the best he could offer was a rate of 15.9% that would be good until August. So now not only was I not feeling like I was getting a very good deal but this new rate would only be a "promotional" rate.
Remaining calm and friendly, and knowing that yelling or telling him what a "lousy" company he worked for would be counterproductive to my end goal…a lower and better APR for this account. I thanked him for his time, but told him I didn't feel this was a very good offer.
Transfer to an Account Manager
Then---the "magic" happened. He asked if I would like to speak to an account manager and that perhaps they could better assist me. I thanked him for his time and assistance and was then transferred to an account manager.
I explained my dilemma to her and told her that as a good customer I expected a much better rate. She empathized with me and then offered to upgrade my account to their platinum status which carried an APR of 9.9%. In addition, the platinum card offered many more benefits and had no annual fee. She also assured me that this was a "contract rate" and not a promotional rate. I would keep the same account number so I would not be opening a "new" account but simply upgrading my current account status.
The Lesson Learned
Next time you sit down to reconcile your monthly statements take a close look at the various APR's you are paying. If you notice a disparity in the rates you are being charged, call your card issuers and negotiate a better rate. My persistence paid off. It can pay off for you too.
© James H. Dimmitt one of the web's "up and coming" authors and contributors. His new e-book on this nation's fastest growing crime---Identity Theft.
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