If you are carrying a debt load such as a mortgage or credit card or both, you are probably paying more for your interest than towards your principal. That is just the way credit works. There is a way you can reorganize your finances to ensure that you get a mortgage or credit card that is actually cheaper. Ask for a lower rate.
It is true that a very simple phone call can save you thousands of dollars in your interest costs. If you do not make the call, credit card and mortgage lenders have no motivation to lower your interest rate. In the case of cheap financing, the squeaky wheel will get the grease. In a 2002 national survey from U.S. Public Interest Research Group fifty customers with varied credit backgrounds called credit card and mortgage companies and requested lower rates.
In this study, over half scored lower rates - a whopping 56%. Rates were seen to drop on average from 16% to 10.47. Customers reported being very impressed that their credit cards and mortgages rates were sliced by one third simply through one phone call. It simply flows with the - it doesn't hurt to ask philosophy. If you don't ask, you DEFINITELY won't get it. If you do ask, you just never know what could happen.
So why don't more people do this? It is simple, it just doesn't occur to us. We are given a rate, we sign to it, and we presume it is immovable. But it costs credit card companies and mortgage lenders several hundred dollars in advertising and marketing to acquire one new customer.
Today with online vendors offering the same service, competition is tough and if you are a good customer, the lender is going to work hard to keep you. Further, the lenders can afford to cut you a break, and they will do it if they want your business. And this is precisely the approach you need to take when you make that call. "Hi this is so and so calling. In the mail today I've gotten about 4 different offers to reduce my mortgage rate or Visa interest rate. I am interested in getting a lower rate.
What can you do for me so that I won't have to switch to another company?"
You do not need to be aggressive or confrontational. You just need to ask, and always remember that you can catch more flies with honey than with vinegar. And follow the adage, if at first you don't succeed, try, and try again. You may get someone more cooperative on the phone next time. You may be redirected to the "customers threatening to switch" department. You never know what is going to happen until you try.
If you are struggling with high interest rates, you have the power to at least try to do something about it. You have nothing to lose and more money in your pocket to gain
