Can and how do you negotiate with a credit card company for a lower interest rate?

Question

My husband has an account with Dell that has around $900 left to pay on it. We pay around $100 each month on it, always on time and thats well over the minimum. At the time he opened the account, his credit was, well, less than desirable to say the least and they gave him an interest rate of around 18%.

Since opening the account a few years ago, he has made drastic improvements to his credit (to the point we qualified to buy a house). I was wondering if it is possible to get the company to lower his interest rate considering things are a lot better and he has paid them more than the minimum and always been on time with them. The 18% is killing most of the payments we are making, and it sure would be nice to get rid of this bill once and for all!

What approach should we take? Thanks!

Ok, looked a little more at the account online and I was mistaken, the APR is 29.99%! OMG!

Beleive me when I say this this was not my idea to run this up. He thought he would be cool and buy by parents a computer for Christmas last year w/o consulting me. (we were engaged at the time, so finances weren't tied together yet, he forgot that they would be soon!) Had he run the idea past me first I would have stopped it and 2nd it darn sure wouldn't have been a DELL!

I called a little bit ago and it sounds like they may check his credit, (and he will have to be the one to tell them its ok) but they may lower it, so keep your fingers crossed!

Answer 1

One thing to consider is a balance transfer onto a lower interest credit card, or you can try to call them and just ask them to lower the rate, you'll probably have to argue a little bit, and keep asking for a superviser if the person you are talking to tells you "no". I did this once, and it was frustrating, but worth it, Just stand your ground, and keep asking for a
superviser until you get the answer you want. Hope this helps.

Answer 2

Generally speaking, credit cards from a particular company (ie Macy's, Lord & Taylor, Lowe's, Home Depot) are pretty much fixed and rather higher than bank cards (Visa, Master Card, Discover). I know with the banks, if you've been paying on time, for a certain length of time and a certain percent over the minimum, you can speak with someone in customer service and give him/her the reasons: 1. paying on time 2. _ % over the minimum payment every time 3. credit history has improved. I won't say that this will guarantee you a lower rate, but it's worth trying since every company or bank is different. It's just a matter of what their rules are at the time.

If they do not, you'll just have to keep paying until you pay it off. Part of what makes a good credit score is paying a long term loan off on time. With credit cards, you need to keep those at a minimum - a balance of no more than 10% of your credit limit. I hope this helps.

Good Luck as I know how you feel.

Answer 3

I do not think Dell will do this.
Have you gone to Experian.com to see what you credit rating is?
If it is now good you might look into another card that will let you transfer the balance at a much lower rate. Make sure you do not have to make like 2 purchases a month to maintain this as some require it. Check on line to see what other cards are offering. You don't need to give them any info to do this. I recently got a super deal from Advanta but then we have excellent credit. But you s/be able to find something around 3 to 9% I would think. If you have other balances and own a home would it pay you to do a equity loan/ refinance at a low rate making sure your payments do not exceed what you now pay on your cards & house? There are lots of possibilities here.

Answer 4

Sadly, the answer is no! Credit companies will never reduce their fixed interest rate once it is agreed. However, Credit Cards work differently as they are flexible. As the base interest rate (fixed by Government) increases, the credit card charges increase but when base interest rates decrease, the credit card companies will take a long time to reduce their rates thus boosting their profits. The only possible way to avoid paying interest is if you are in serious debt, you can request that they freeze the interest. If they refuse, you can apply to the courts to have the debt frozen, no further interest can be added after that date. If in financial difficulty, you can also offer to pay 50% to 70% of the money owed as final settlement and the company will be highly likely to accept rather than risk getting nothing if you are declared bankrupt. In your case, as you are solvent, you have NO CHANCE! You have to pay what was agreed. However, as it's only $900, ask your bank for a small loan, pay DELL off with it and try to pay the bank $200 per month. You will be clear of that debt in less than 6 months. In future, don't touch DELL. Their PCs are crap and built with both substandard and obsolete parts and as you have now seen, not only are the PCs a rip off, their finance is too.

Answer 5

I had a Dell account with about $1000 financed and I paid at least $100 a month on it and after a year I still owed over $500. I contacted Dell and they said that they do not refinance. So I used my Capital One card to pay it off because the interest is much lower.

Answer 6

Call up and ask. But 16% is about par for the course these days, and you may not get much. If you are paying $100 a month on a $900 balance, you'll be done in less than a year in any case, so I don't see it as a big issue -- the finance charges are only about $15 a month, and will be decreasing.

Answer 7

You have to threaten to transfer your balance to another lower interest card, or to get a loan to pay them off. You should be able to get a non-secured loan at a bank for 9 or 10% if your credit is decent. Tell the card Co. that you are planning to do this unless they give you a similar rate, say 10%...

Answer 8

I've done this several times over the years.

First, just call up and ask to have your rate reduced. Feel free to mention the need to cut expenses due to the house purchase.

I've gotten 19% and 29% cards cut down to single digit percentages just by making the call. Having, or claiming to have, a balance transfer offer in your hand will give you more leverage.

Answer 9

You call them up and ask, but in Dell's case, I doubt they will do a thing. You could try to transfer the balance to a lower rate card.