Lower and higher interest rates
Select’s editorial team works independently to review financial products and write articles that our readers will find useful. We may receive a commission when you click on product links from our affiliate partners.
The pandemic has negatively impacted consumer wallets in multiple ways. Credit card issuers have responded to changing consumer habits and new financial constraints by offering higher reward rates on certain expense categories or reducing annual fees on certain cards. While some banks have been proactive in this area, many have asked their credit card issuers for better terms on their cards.
A recent report from LendingTree found that of the 47% who asked for better terms on their credit cards, the majority cited the pandemic as their main reason for doing so. Asking for different terms on your credit card could range from asking for a waived or reduced annual fee, a lower APR, a larger line of credit, or a larger signup bonus.
When you decide to ask, it’s best to call customer service.
John Ulzheimer, a credit expert formerly with FICO and Equifax, distinguishes between the different types of requests that cardholders make to card issuers as either a risk assessment issue or a marketing issue.
Ulzheimer describes marketing problems as requests for a larger welcome bonus or reduced (or waived) annual fees. Credit card issuers are more than willing to respond to these small demands because they want to keep you as a customer.
Some card issuers, like American Express, are known to be more responsive to requests. Amex has its own retention offers service that you can be transferred to when you call. According to a 2020 JD Power Credit Card Satisfaction study, Amex ranked first in customer satisfaction among national card issuers.
Brendan Dorsey, an editor at Select, and Brett Holzhauer, a reporter for Select, each successfully evaluated the loyalty offers by calling or texting Amex customer service.
Holzhauer was able to secure a better interest rate and a bonus offer, which required a certain amount of spending within a period of time, on his Blue Business® Plus credit card from American Express in June 2020.
Dorsey recently secured a retention offer on three of its Amex cards: the American Express® Gold card, the American Express® Platinum card and the Hilton Honors American Express Aspire card.
American Express® Gold Card
On the secure American Express site
4X Membership Rewards® points on restaurants (including takeout and delivery, as well as Uber Eats purchases) and in U.S. supermarkets (up to $ 25,000 per calendar year in purchases, then 1X), 3X points on flights booked directly with airlines or on amextravel. com, 1X points on all other purchases
60,000 Membership Rewards® points after spending $ 4,000 on qualifying purchases within the first 6 months of opening the account
Balance transfer fees
Foreign transaction fees
“I asked if they could waive the annual fee for my credit cards. I mentioned that it was difficult to justify paying so many annual fees for travel credit cards during a travel restriction period. because of Covid-19, “says Dorsey.
Dorsey was able to earn 30,000 Membership Rewards points on her Platinum card, 10,000 Membership Rewards points on her Gold card and 10,000 Hilton Honors points on her Aspire card without having to meet spending requirements. He notes that he was also able to secure similar retention offers during the pandemic-free years.
John Schulz, chief credit analyst at LendingTree, points out that whether or not there is a pandemic, there are always relatively high success rates when it comes to asking for better terms on your card.
“We have very high success rates when it comes to claiming a lower APR or waiver fees,” Schulz said. “It’s not just a function of the pandemic.”
Request a lower interest rate or increase your credit limit
Ulzheimer suggests that people keep their expectations reasonable when making larger demands, which he describes as risk assessment issues. This includes asking for a significantly lower APR or a much higher credit limit.
These requests typically require card issuers to do a thorough investigation of your credit report, which can cause your credit score to drop slightly. If you are planning to apply for a mortgage or buy a car in the near future, you may want to delay these applications due to your declining credit score.
Schulz says people don’t negotiate because they often don’t know they can. The LendingTree study found that 28% of those who said they didn’t ask for different terms on their credit cards didn’t know they could.
“A lot of people just don’t know they can [negotiate]. There is also a large group of people who don’t like negotiation and don’t like confrontation and don’t pick up the phone just because they’re afraid to do so. This is understandable, because trying to trade against a giant, giant financial institution can be intimidating, “Schulz said.” But the truth is, people need to realize that they have more power in their dealings with their issuers. of credit cards… “
Whether you ask your issuer for something small, like a reduction in your annual fee or a larger request, like a doubling of your credit limit, you have nothing to lose by picking up the phone and talking to your bank. . It could save you real money and the worst they can say is “no”.
For pricing and fees for the American Express Gold Card, click here.
Information on the Hilton Honors American Express Aspire Card was independently collected by CNBC and was not reviewed or provided by the card issuer prior to publication.
Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.