Have you ever called your bank and asked for a lower rate? Most people haven't. They assume the rate is fixed, non-negotiable, take-it-or-leave-it.
That's wrong about 30% of the time.
I'm not saying every bank will lower your rate. But many will, especially if you've been a good customer. I've seen it happen with credit cards, personal loans, even auto loans. Here's how to do it without being a jerk.
I had a client named Rhonda who had a credit card with a $8,000 balance at 19.9% APR. She'd had the card for 11 years, never late. She called the number on the back and asked for a lower rate. The first rep said no. She asked for a supervisor. The supervisor offered 15.9% — a 4% drop. She accepted.
That 4% saved her around $320 a year in interest. For a 15-minute phone call. That's a rate of return of around $1,280 per hour. Not bad.
Here's the script I gave Rhonda:
"Hi, my name is [name]. I've been a customer for [X] years. I've never missed a payment. I'm calling to see if you can lower my APR. I've received an offer from another lender at [lower rate], and I'd prefer to stay with you if you can match it."
Notice: she didn't threaten to leave. She just mentioned a competing offer. That's enough.
Now, this doesn't always work. I had another client, Marco, who tried the same thing on his auto loan. The bank refused. He had a 680 credit score and had been late once 14 months ago. They said no. He was frustrated. But he didn't lose anything by asking.
If the first rep says no, ask for a supervisor. If the supervisor says no, ask if there's a "relationship discount" or "loyalty rate." Some banks have internal programs that reps don't mention unless you ask.
Marco ended up refinancing his auto loan with a credit union at 2% lower. That saved him around $1,200 over the life of the loan. He didn't need the bank to say yes. He just needed to look elsewhere.
Rhonda paid off her credit card within 14 months. She called me when she made the last payment. I could hear the smile in her voice. She said, "I felt so powerful on that phone call. Like I was in control for once."
You can feel that too. Pick up the phone.
I will keep posting updates on this. Check back soon.
P.S. Cooper is now staring at me because I haven't fed him dinner yet. That's negotiation too. He's good at it. Learn from him.
James Whitmore