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4 Hidden Secrets of Your Credit Card


4 Hidden Secrets of Your Credit Card

Most consumers probably feel that they are at the will of their credit card provider. The truth, though, is that the customer actually has more control than you might think.

In the wide world of business and industry corporations are in control of many things. They control the way consumers see their product or how much that product costs. They control how they market and who they market too and sometimes even how their demographic reacts to their product.

When it comes to credit cards, many people feel they are in a similar boat but the truth might be somewhat eye-opening. Here are the four secrets that your credit card issuer does not want you to know:

1. You have more power than you think—when you have a high credit score, you have more power than you think. Credit card issuers profit from giving credit cards to people who use them responsibly and, believe it or not, a good credit score is a benefit to them. Thus, if you have a credit score above 700 you actually have a great deal of negotiating power. When you reach 750, though, you have even more. Still, even if your credit score is significantly lower, you still have room to negotiate if you can show that you are a responsible credit user by proving you have a history of prompt and consistent bill payments.

2. You can increase your credit limit—this one is a bit tricky. When you ask about increasing your credit limit, one of three things will happen: your credit card company will review your account and approve the increase, they will deny your increase and change nothing about your account, or they will realize that you have too much credit and might actually decrease your limit. Obviously, the first result will benefit you and the second one will not affect you at all, but if they reduce your credit limit it will increase your liability-to-availability ratio, which will more than likely negatively affect your credit score. Thus, you should be quite sure you deserve a credit limit increase before you ask for one.

3. You can remove your annual fee—just as you can lower your interest rates you can also negotiate to get rid of the annual fee. While you might not always get exactly what you want, asking for a lower rate will almost never hurt you, which is the same case when asking for the removal of the annual. This is another case in which your history of making payments on time and never going over your limit will greatly help you. It may also be that you cannot get the whole annual fee removed but perhaps reduced. Either way, every little bit helps when you are trying to save money.

4. You can lower your interest rates—carrying a credit card creates a relationship between you and the credit card issuer which actually gives you some grounds for negotiation. If you find a card that offers you a better interest rate, for example, you can call your current credit card company and tell them you are considering switching to another card. If they want to keep your business (and they do) they will try to find a way to make your current relationship more enticing. Sweeten the deal by telling them that you do not want to leave, that you actually like their services, and have never had a problem but you really want the monetary savings. If you are currently in good standing, this will kind of be a no-brainer for your credit card issuer.

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