In the past, I've called my credit card companies to ask for a lower interest rate. But recently I've read that this could actually backfire, causing them to raise my rate instead. Is that true?
This is a good question, and one I've spent a lot of time researching recently. For years, I've advised consumers to call and ask for a reduction in interest rates. It works about half the time—and I've seen studies that back this up. And after talking to Nessa Feddis, vice president and senior counsel at the American Bankers Association, my advice still stands. "I have talked to card companies, and none of them are raising rates or cutting credit lines because of this. I think people's perception is that their interest rates were hiked because they called, but they just happened to call when interest rates were being hiked. The letter was already in the mail," she says.

So go ahead and call, but be careful what you say. Don't give them any indication that you're struggling to pay your bills or that you've lost your job—until, of course, you truly are struggling to pay your bills, and by that I mean a few months behind. At that point, it's always better to be upfront. More than ever, Nessa says credit card companies are being aggressive about trying to help people.


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