Talk your way out of credit card debt


Happy New Year!

It’s 2009 and time for people to make the New Year’s Resolutions – lose weight, stop smoking and get out of debt.

I’ve been reading this book by Scott Bilker about talking your way out of credit card debt – in it he has transcripts of calls that he made to credit card companies to get his debt reduced.  He made calls to waive late fees, lower the interest rates and get better offers.  Sometimes it worked and sometimes it didn’t.

He pointed out that the calls usually didn’t take that long – maybe 5-10 minutes.  And then he calculated how much interest he saved on that phone call, and usually it came out to earning several hundred dollars an hour becuase each call only took a few minutes.

I recently did this with all my credit cards and I wasn’t so successful.

It seems the financial crisis and huge credit losses the banks and credit card companies makes them want to extend less credit and be less generous with their credit offers even though prime is so low right now – currently at 3.25%. The banks and credit card companies are trying to recoup their losses from the bad customers by making the good customers pay higher rates.

I have 5 credit cards – Discover, Bank of America, Chase, ATT, and USAA.

The only one that was able to reduce my rate for any period of time was ATT and they are closing my account soon anyways because their computers show I am a bad risk.  They reduced my purchases rate from 15 to 9.9% for 9 months.  They had a rate of 7.9% for 6 months but I went with the longer term because it saves a little bit more.

Discover card offered to extend a balance transfer offer from April to August but no waiving that 3% fee that can cut into your savings.  $100 just to transfer a balance!

And then I called USAA and the rep said that USAA was raising rates on all customers by 2% on February 1st. And that I should have received a letter.  No letter.  That’s crap.

So because they made bad investments, they have to charge higher rates for their good customers – nice way to treat your customers.

So all in all, I wasn’t too thrilled with talking my way out of debt, maybe in a different market environment I would have had better results.

Don’t let that stop you though.  If you have a good payment history and a good credit score – call your credit card companies and see if you can get your rates reduced.

You don’t need to pay more interest than you have to.


The Credit Blogger