There are many ways to engage in interest rate negotiation. Let’s take a look.
Call Your Creditors
If you want to engage in interest rate negotiation and lower your interest rates on unsecured debt, like credit cards, you can always call your creditors and ask for a lower interest rate. Nothing is stopping you from doing that and the worst thing they can say is they can’t offer you a better rate.
However, calling and asking for a lower interest rate can also result in an actual lower rate or an introduction to a new card with better perks you can use.
Interest Rate Negotiation is Much Easier With Good Credit
If you have excellent credit you will probably find it easier to negotiate a lower interest rate. You’ll also find it easier to get higher credit limits as well.
Keep in mind that having great credit doesn’t mean you have to take creditors up on every offer of credit they toss your way. But that excellent credit does mean you are very attractive to creditors who are looking for “top notch” card holders. Creditors will often give the best credit card interest rates to the people with exceptional credit scores.
Pay Your Credit Card Bills In Full
The easiest way to get your interest rates negotiated is to not worry about them at all. If you pay your credit card bill in full each month by the due date then you will not have to pay any interest. If this is your approach then instead of entering into an interest rate negotiation you can cut the interest you pay to zero each month. The power to pay no interest at all rests in your hands.
Enter Into a Credit Counseling Program
When you enter into a credit counseling program your interest rates are often cut and slashed. While the credit counseling program will not allow you to use the credit cards included in the program, your credit card interest rates will get cut and lowered.
Not Every Debt is a Good Candidate for Interest Rate Negotiation
Secured debts like mortgages and car loans are not able to have their rates lowered with negotiation. However you could take out a new loan with a lower interest rate and payoff the older more expensive loan.
Student loans may be a good candidate for interest rate negotiation. While federal student loan interest rates are not going to change through negotiation, private student loan interest rates may. If you find yourself behind and in default on your private student loan and the creditor offers you a settlement on the balance you owe, it’s not unusual for you to be offered an interest rate as low as 0.01% of the balance of your loan.