Few consumers who are struggling with their credit-card debt ever try debt negotiations with their cardholders. This is unfortunate because consumers might be passing up on some free financial relief if they never ask their credit-card companies to relieve at least part of their debt burden.
Credit-card debt is some of the worst debt out there. That’s because it comes with such high interest rates. According to research, the average interest rate on consumer credit cards was more than 16 percent in mid-December of 2009. It’s hard to pay down your credit debt if you carry a balance from month to month. Those high interest rates keep it climbing.
That’s why it’s so important to engage in debt negotiations with your credit-card issuers. The simplest way to control your revolving debt is to ask your credit-card issuers to reduce the interest rates they are charging you. You might think it unlikely that a credit-card company would willingly drop your interest rate from, say, 17 percent to 10 percent. But research shows that the majority of cardholders who ask for an interest-rate reduction receive it.
There’s a simple reason for this: Credit-card companies know that they operate in an extremely competitive industry. If they don’t lower your interest rate, you can easily transfer your existing balance to a different card that does come with a lower interest rate. Rather than lose you as a customer, they’re more than happy to make some concessions, including dropping your interest rate.
A lower interest rate can make a big difference in the size of your monthly revolving debt. If you carry a balance on your cards from month to month, your credit-card debt won’t grow nearly as fast if your interest rate is 9 percent instead of 16 percent.
The key to lowering your rates is in the debt negotiations that you’ll hold with your credit-card issuers. Simply call your card company, ask to speak to a supervisor and tell that person that you want to reduce your interest rate. Odds are, that supervisor will not only listen, but will act, too. Also don’t forget there are plenty of resources and free articles on the web that shed more light on ways to reduce debt.
Tags: debt negotiation, debt negotitation tips, Debt Reduction, reduce debt