Last week your homework was a very simple task; gather up all your cards, write down the name, balance, interest rate and credit limit of each card. I am guessing you were able to complete this task in an hour or so, but I gave you all week because that is how slow we are taking this…one tiny step at a time. Too many people try to rush into paying off the debt without a methodical process of doing so, thus “falling off the bandwagon” way too quickly because they are overwhelmed. I am aiming to change this with this slow process.
For this week’s homework, you are going to take that list of all your credit cards and call each and every company on it and ask for an interest rate reduction. Scared? Don’t be, they get these calls all the time and yours will be next. But you may be asking yourself why they would give you a rate reduction and the answer is actually quite simple; competition is tough in the credit card market, there are tons of companies and cards for consumers to choose from. These companies want to keep you as a customer because it can cost anywhere from $0-$250 to acquire new customers. (I know this for a fact, because American Express just got me as a new customer, but they had to give me a $250 gift card to get me…see?) So you really have nothing to lose by calling them up and asking them, and they have a lot to lose. It is certainly worth a shot! If you are feeling nervous about calling them, you can use the following “script” on each and every one of them:
“Hi, I am calling to inquire about getting an interest rate reduction on my “insert name here” credit card. I have gotten a really good offer on a balance transfer from another one of my cards, and while I would prefer to keep my account with you guys, I have to be careful of how much interest I am paying. Is there anything you can do for me?“
Even if it is only a small reduction in the interest you are paying, just say thank you and get off the phone. You can always work on “real” balance transfers later as you get further into your debt reduction program. For now the goal is just reducing your interest charges right off the bat. Mind you, this will probably only work if you have kept up with your payments. If you have not kept up, you might want to try a different approach:
“Hi, I am calling to inquire about getting an interest rate reduction on my “insert name here” credit card. I am starting to have trouble keeping up with some payments and would really appreciate you guys working with me in the short term to reduce my interest charges for a little while. Is there anything you can do for me?“
This does work sometimes, trust me. I have a friend who did the exact same thing and she got some points taken off her interest rate right away because the company did not want her to default on the money she owes.
You might be scared to start calling them and asking for reductions, but you have absolutely nothing to lose and only money to gain. Even a tiny reduction can make a dent in the amount of money you owe. So for this week, I want you to call each and every one of the companies that you have cards from and use the same script as above for each one. If you can get even just a few of them to change the rate, you have succeeded. I know this feels like a lot of work to some of you who are not used to asking for what you want, but it is definitely worth your time. You have one week to call every card, ask for the reduction, and note the new rates on each card you own. In the meantime, continue to keep only 1 card in your wallet for emergencies only and do not rack up any further debt on any of the cards. You do want to get out of debt, right?
Next week will bring a new task for you to get done, so you now have seven days to get the phone calls done. Get to it!
If you missed part one of this series, you can read it right here, part two is available right here, part three is available right here, part 4 is available right here and part 5 is available right here.