Credit Card Issuers Now More Open to Negotiating Rates With Customers

by News Guy on August 11, 2010

As the credit freeze begins to thaw, credit card issuers are becoming more open to negotiating interest rates. DebtGoal, the leader in online personal debt management, has data from users of its free online tool NegotiateMyRate showing that rate negotiations are now significantly more successful than they were just a few months ago.

Since its launch in May, 67% of NegotiateMyRate users have successfully lowered their interest rates, with an average reduction of 9.3%. This time last year, only 12% of consumers who tried to negotiate their rates were successful. But even though card users can save a bundle in interest payments by negotiating a lower rate, 65% don’t bother.

Scott Crawford, DebtGoal’s CEO and a former HSBC and Congressional Budget Office employee, thinks these factors have led to the new flexibility issuers are showing cardholders:

  1. Credit card issuers are finally competing for business again, as opposed to last fall when they were hunkering down and trying to get people off the books  (Amex was actually paying people to close their accounts)
  2. The Credit CARD Act prompted issuers to raise rates, but many are willing to negotiate back down to keep business

About NegotiateMyRate

NegotiateMyRate leverages its large community of members to track the results of previous negotiations and displays these results to other borrowers, empowering them to negotiate more effectively with their lenders. The site provides a script for first-time negotiators, shows consumers how much they can save at a lower rate and reveals which credit card companies are most willing to negotiate.

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