6 favors you can ask your card issuer
Reduce your APR? Waive that late fee? Good customers can win a 'yes'
By Allie Johnson | Published: September 1, 2016
Want your credit card issuer to do you a favor? There are no magic words that will convince your creditor to grant your every wish, but a phone call and a little finesse may get you a yes.
You can call your credit card company to request anything from a lower interest rate to a higher credit line to a payment plan to help you get out of debt. To make a decision, the issuer will look at a variety of factors that may include how long you’ve been with the company, your credit score, whether your card is close to maxed out and even variables that have nothing to do with you, such as how many other cardholders are skipping out on their bills, says Robert Hammer, CEO of R.K. Hammer, a bank card advisory firm that counts top U.S. card issuers as clients.
“If you don’t ask, you don’t get,” Hammer says.
Here are six favors you can ask from your card issuer, how to ask for them, and what the issuer may consider when making a decision:
1. Will you lower my interest rate? – If your payments aren’t making much of a dent in your balances due to high interest charges, you can try calling your issuer to ask for a lower APR, says Melinda Opperman, chief relationship officer for Springboard Nonprofit Consumer Credit Management, a credit counseling agency. “That one call could save you money month after month,” she says. Before you call, check the average credit card APR so you can mention it if yours is higher, Hammer says. Also look at the rates on card offers you’re receiving by mail so you can point out that other companies are offering better deals. “Credit card companies know other companies want to poach their balances, and they don’t want to lose you,” Opperman says. Your issuer will look at factors such as your history of on-time payments, your current FICO score and whether it’s gone up since you opened the account, says Jim Angleton, president of AEGIS FinServ, a debit and credit card issuer.
That one call could save you money month after month.
Springboard Nonprofit Consumer Credit Management
So, what are your chances? A 2016 CreditCards.com survey found that 3 in 4 cardholders who asked got a better rate. “If your account is in good standing, and you’ve been paying your bills on time for at least a year, credit card companies very often will give you a better rate,” Opperman says. However, if you’ve been consistently late with payments, the odds of being granted a lower rate aren’t great. Wait until you’ve been current on payments for a while before attempting to make this request.
2. Will you delete my late fee? If you’ve always paid your bill on time, but slipped up once and got dinged with a hefty late fee, call your issuer to ask if the fee can be reversed. Most issuers will consider deleting a late fee as a one-time (or maybe two-time) courtesy. For example, American Express will review late fees upon request, and will consider the cardholder’s relationship with the company as well as spending and payment history, says spokeswoman Jane DiLeo. A card issuer also may look at the excuse you give for being late and how late you paid, Angleton says. Illness and travel commonly cause good customers to slip up once and pay a day or two late, he says. If you’re not a repeat offender who paid weeks late, you’ve got a good chance of getting the fee waived. The CreditCards.com survey found 89 percent of cardholders who asked got a late fee reversed. But if you’ve made several late payments, you’re probably out of luck. “After the third time, they don’t care if you’re in the hospital because you had a heart attack,” Angleton says. “It’s three strikes and you’re out.”
3. Will you increase my credit limit? If you’re planning to make a big purchase or go on a long trip and want to boost your spending power, you may want to ask for a credit line increase. One word of caution, though: This request most likely will trigger a “hard pull,” or an official credit check, Hammer says. That credit inquiry can cause a slight, temporary dip in your score and can even throw a wrench into the process of getting a mortgage. If that’s not an issue, start by calling customer service, but know that you may need to ask for a supervisor if you want a big increase, Hammer says. The issuer will consider your payment history, FICO score and recent spending behavior, Hammer says. For example, if you just racked up a huge balance, that’s a red flag that could get you turned down, he says. For Capital One, two of the most important factors are a history of on-time payments and paying “substantially more” than the minimum payment each month. Also, Capital One accounts less than 3 months old or those that have had a credit line increase or decrease in the past six months aren’t eligible. You also could get turned down if you barely use your card. In that case, the company “may not have sufficient payment history to review,” according to Capital One.
4. Will you waive my annual fee? If you opened a card to snag a juicy sign-up bonus, the annual fee may have been waived for the first year as part of the deal. If you’ve had the account for close to a year, and it’s almost time to pay up, try calling your issuer to ask for another fee-free year. Annual fees range from $25 to $450, so that five-minute call could save you a chunk of money. Issuers will look at your payment history, credit score and length of time as a customer, Angleton says. If you’ve been with the company for five years or longer and have always paid on time, the issuer may say yes about 75 percent of the time, Angleton says. Even if the issuer says no, it may offer additional rewards to up the value you’re getting for the fee you pay. “They may say, ‘We’ll give you 10,000 miles if you stay with us,’” Angleton says, which may make it worth paying the annual fee if it’s modest.
If you can’t make the whole payment, the worst thing for the lender would be for you to pay $0.
|— Thomas Miller
Mississippi State University College of Business
5. Will you switch me to a different card? Maybe you used to travel the world for your job, but you now work from home and your airline rewards card no longer works for you. If your life has changed, you can call and ask to switch to a different card at the same bank. Angleton says his company gets these requests a lot. But make sure you first use any remaining rewards, so you don’t lose them when the original account gets closed, he says. You also should know that the company likely will do a “hard pull” on your credit before giving you the OK to switch cards. While changing cards may save you some hassle, it may not be a wise move because you’re limited to the offerings of one issuer and may not get the best terms, Angleton says. To get the best card and the best deal, shop offerings from a variety of issuers, he says.
6. Will you put me on a hardship plan? Maybe you lost your job, got sick or divorced, and are struggling to make even your card’s minimum payment. If times get really tough, call your card issuer and ask to be connected to the hardship department to request a “workout,” Opperman says. If you can’t pay your bill, issuers typically will try to help in some way, she says. For example, American Express offers assistance programs for cardholders facing financial difficulty, DiLeo says. Depending on the situation, a program might offer lower payments, reduced interest rates and waived fees. If you participate in an assistance plan, the issuer likely will close your account, Opperman says. This can hurt your credit score by lowering your available credit, which affects your credit use ratio. Giving you a hand benefits the card company because there’s a rule in the banking world that says “never let the cash dry up,” says Thomas Miller, the Jack R. Lee Chair of Financial Institutions and Consumer Finance at the Mississippi State University College of Business. “If you can’t make the whole payment, the worst thing for the lender would be for you to pay $0,” Miller says. You don’t need to be late on your payments to convince your card issuer to work with you, so call as soon as you anticipate a problem paying your bill, Opperman says. “Being proactive is good,” she says.
One thing to remember when you’re making a request of your credit card company: They’re looking at the big picture of you as a customer, Hammer says. “There’s no one thing that will make them say yes or no,” he says.
the case to your credit card company
If you plan to ask for a favor from your credit card company, these tips may increase your odds of getting a positive response:
- Gather data before you call. Before you call, know the length of time you’ve had the card, your payment history for the account and your credit score so you can make the case that you’re a good customer, Hammer says.
- Ask for what you want. “You need to say ‘I’m calling to get X. Can you help me with that?’” Opperman says. Customer service representatives have strict rules to follow and possibly a manager monitoring their calls, Opperman says: “They have to hear you say the words before they can grant your request.”
- Up the ante. “Use the magic words: ‘I’m looking at offers from competitors,’” Angleton says. Politely letting a company know that you’re thinking about leaving, but adding that you’d love to stay, may increase your chance of getting what you want, he says.
- Go up the chain. If you’re getting nowhere with your request, nicely ask to speak to a supervisor, Hammer says. The customer service representative may not be authorized to approve your request, which may be “above their pay grade,” Hammer says.
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