There are plenty of credit repair negotiating secrets regardless of how good your credit is. Here are 5 tips to get you started.
Tip #1 Ask
Credit card companies are constantly competing for your business. It's easy for consumers to switch to another company so you can get all sorts of better terms just by asking. If you need a reason tell them you've been a good customer, made your payments on time, etc. Even if you don't have perfect credit, companies want to keep making money and will almost always offer better terms to keep you happy.
One friend of mine called to cancel her card because she'd maxed it out and wanted to avoid the temptation to use it again once she paid it down. To try persuade her to keep it open, the company offered to reduce the rate to zero and let her make payments that fit her budget better. That's to say that some credit card companies are ready to offer you a settlement kind of deal without even having to go through an of the standard collection procedures first.
Tip #2 Don't max out all your cards
If you leave room on your credit cards, you can always do a balance transfer to the card with the lowest rate. Also, if you keep your balances around 30%, credit card companies are happy to extend your credit limit every so often because they see you're using it and they're making money on the interest.
Tip #3 Make credit card companies fight for you
The easiest way to negotiate is to have a better deal somewhere else. Creditors know that you MIGHT have a better deal if you went and worked at it. You have much better leverage if you already DO have other options. If your cards are all maxed out, you don't have other options. If you've left room on your cards, you can balance transfer to the cards with better terms and then offer to transfer it back if they offer you a better deal.
Tip #4 Keep your credit as clean as possible
Hopefully this goes without saying. The better customer you are, the better terms they'll give you. If something happens and you won't be able to stay on time, consider whether it makes sense to only fall behind on some of your accounts. For example, if you have a zero percent interest rate credit card, you might want to stay current on that one and let the rest slide.
Tip #5 Do the math
Most people only negotiate the interest rate. While that's usually the most important factor, you ought to look at any additional fees, any rewards for using the card, and how long the rate is good for, etc. A company that wants you to call in every month to give you the best rate won't be as attractive as a card that gives you a fixed low rate.
At the end of the day, the key to negotiating is to know where you are and where you want to be. Then get out there and keep asking until you get what you want.
