Credit Cards and Debt Interview with WINA Radio Charlottesville, VA
CreditCards.com Senior Industry Analyst Matt Schulz spoke on Monday, December 28, 2015 with Les Sinclair of WINA Radio Charlottesville, VA about paying off credit card debt. The interview and transcript are below.
Les Sinclair: It’s Charlottesville right now. It’s where you go when you need to know. And when we need to know we go beyond the headlines and turn to the experts. Matt Schulz is with CreditCards.com. And he’s going to join us here this afternoon to give us some great advice on what we can do to get our debt down in 2016. That’s gotta be one of the most popular resolutions, isn’t it, Matt?
Matt Schulz: Yeah, no question. And it’s an important one too because so many people out there feel paralyzed by debt and are hopeless. And really it’s so important for people to know that there are things that they can do to start knocking that debt down.
Sinclair: Well, let’s start with task number one then. What is the thing I should do to start knocking the debt down?
Schulz: Well, one big thing that a lot of people don’t realize they can do is call their credit card issuer and ask for a lower interest rate. And people would be really surprised by how often that works. We did a survey a while back that showed that not only about a quarter of credit card holders have ever asked. About two-thirds of those who did had their request for a lower APR granted. So that means a lot of people are paying interest than they need to.
Sinclair: So you just call up the credit card company. Get somebody on the phone and say, hey, I want to lower my interest rate?
Schulz: Yeah. I mean you shouldn’t go crazy and ask to have it lowered from 20 to 10 percent of something like that. But you could certainly have it dropped by a couple of points. And as my mom and dad used to say, the worst thing that they can do is say no.
Sinclair: Exactly. And then you’re in the same situation. And if they say no and you’ve got a better offer so to speak, maybe you got one of those offers with the low interest rates in the mail, should you take that offer?
Schulz: If it’s good enough, sure. And you could also potentially if you’ve gotten flyers in the mail or if you’ve seen offers online at places like CreditCards.com you can use that as a negotiating tactic as well. It’s such a competitive marketplace that doing that sort of thing can work.
Sinclair: So you can actually say, hey, I got this offer in the mail for 15 percent or something like that if you’re paying 24 and they may match it or at least come down close to it.
Schulz: They’ll certainly consider it. And you can also apply for a balance transfer card. And potentially pay 0 percent interest on that balance for up to 21 months, which is the longest period that we’ve seen in a while. And that can really have an impact on your interest too.
Sinclair: How do you decide whether 3 percent fee is better than an interest rate? How do you decide on that?
Schulz: Well, it’s really about doing the math. And we have calculators at CreditCards.com that can help you do that sort of thing and help you do the math on it. But by and large if you have good enough credit there are cards out there, like Slate from Chase, for example, that do not feature a transfer fee. And that can save you some real money.
Sinclair: Wow. Wow. That’s fantastic. All right. And the last one is probably first on my list, which is you gotta know where you’re starting, right?
Schulz: Yeah, exactly. Know thyself as the saying goes. You have to know what got you in debt in the first place. Was it a temporary thing like a medical emergency or job loss? Or are you just somebody who can’t handle the lure of extra credit or who has a hard time making payments on time? And once you understand that, you can figure out the best way to go about making your battle plan to bring down that debt.
Sinclair: And how important is a plan, Matt?
Schulz: Oh, it’s incredibly important. Because a plan is a way to hold yourself accountable as you try to knock down that debt. So it’s a very important thing.
Sinclair: Yeah. And you’ve gotta reward yourself along the way too. Matt Schulz is with CreditCards.com. He’s got more great tips over there. You folks really compare and contrast the credit cards. Give really good advice on what folks should be looking for with regard to their credit, right?
Schulz: Yeah. Absolutely. We’ve got dozens of cards and hundreds of articles to help you make smart choices.
Sinclair: All right. Really good stuff. And we certainly appreciate all the help you’ve given us over the course of 2015. So on behalf of everyone here at WINA I want to say thank you and Happy New Year to you, Matt Schulz.
Schulz: Same to you. Always good to talk.