Want an easy way to reduce your debt? Ask!

The other day I received a flyer in the mail from my credit union about low interest rates on car loans, both refinancing and for purchases.

I don't have a lot of time to go to the bank and what not, so instead of even shopping around, I simply called where I have my current car loan, told them I was wanting to reduce the interest rate on my current car loan, and mentioned my credit union was offering me a good deal. They countered with reducing the APR on my current car loan by 0.5%. I said I would think about it.

Talked it over with my wife, and we decided since we were going to pay the car loan off early anyway, it didn't make sense to actually refinance and pay the fees associated with it. So I called back and got a different rep. I pretended I hadn't talked to them before just for fun and went through the same BS, but this rep offered to cut the rate by 0.75%!

This will save me about $1,200 over the life of the loan, and it didn't cost me a dime, just about 30 minutes of my time calling.

I've read where people literally just called their creditors and asked for lower interest rates and got them, but I didn't think that it would be that easy, but apparently it can be.

If you have credit card debt, or moderate to high interest rates on car loans, etc., call and ask for a better rate. You might get it.

And... uh... if you don't like the offer, call them immediately back and get a different rep and ask them, you might get a better offer.

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Comments

NetAdmin2436

A year ago I simply called my credit card company and asked for a lower rate on one of my high interest cards. They knocked 10 points off my interest rate. All I told them was that I am a good customer and have never missed a payment in x years. I always pay my credit cards back monthly, but it's a better feeling knowing my interest rate is that much lower in case I ever have cash flow problems.

Here are some simple phone scripts to use...
Ways To Reduce Credit Card Interest Rates

....I wish this worked with mortgages.

puertorico123

NetAdmin2436 wrote: »

A year ago I simply called my credit card company and asked for a lower rate on one of my high interest cards. They knocked 10 points off my interest rate. All I told them was that I am a good customer and have never missed a payment in x years. I always pay my credit cards back monthly, but it's a better feeling knowing my interest rate is that much lower in case I ever have cash flow problems.

Here are some simple phone scripts to use...
Ways To Reduce Credit Card Interest Rates

....I wish this worked with mortgages.

the bad side of transfer balanced is the charge, some time the credit card with the offert will be charge a fee of 3%.

HeroPsycho

puertorico123 wrote: »

the bad side of transfer balanced is the charge, some time the credit card with the offert will be charge a fee of 3%.

Yes, but here's a neat way to offset that some if you're targeting to pay the amount off at or soon after the intro rate period is up.

Last year, we had about $10,000 in credit card debt, and we knew we could pay it off roughly in a year's time, but we were still paying 9.5% interest on that debt. I calculated it up how much money we'd save by transferring to a 0% intro rate card for 1 year with the 3% fee. Turns out we'd save about $1000 (I'm really not remembering this well) in interest doing it this way - $300 in fees. Still, $700ish though I'd come out ahead, so we did it.

But then I realized that the amount I was budgeting per month to pay it off by the time the intro rate period ended was less than the min monthly payments. So....

I paid the minimum monthly payments, and stuck the rest in an interest bearing account at my bank. Sure, the interest rate was crap, but it was something, and I ended up over the year making roughly $150 in interest. That's half of the $300 fee!

When the intro rate ran out this past February, I had the money in savings to pay the card off of course, which I did.

Sometimes it's good to have a little creativity.

We're now credit card debt free for the first time in our marriage, which is great. We're gonna be in terrific shape after refinancing the house, and my car gets paid off next year. We could probably then really hammer on my wife's car loan and get that paid off sooner.