Man negotiating a better credit card interest rate

How to negotiate better credit card fees, interest, and debt

If you have a credit card, or even two or three of them, you might already know how convenient they are. They’re a blessing when you have an emergency or are short on cash and need to put gas in your tank, buy food, or even that shirt you just had to have that’s now sitting in the middle of your floor.

But credit card debt can stack up fast. Whether you do have an emergency that you’re trying to cover with the credit line on your cards or you’ve simply spent more than you should, you’ll soon notice that the interest on your card can really add up to big fees. In some cases, it can add up to more than what you actually spent.

All those fees, interest and debt can completely drag you down and make your situation spiral out of control. You don’t have to keep falling down the rabbit hole. There’s a way out of all of this. Spoiler alert: it’s not having your dog chew it up like your homework when you were a kid.

So, what can you do with those credit card fees, mounting interest, and debt? You can negotiate your way to a better deal and get back on top of things again.

It’s not even near as difficult or intimidating as it sounds. Keep reading and I’ll walk you through it all. You’ll be glad you read this when you can negotiate your way to better deals!

Here are the credit card fees you can negotiate

Believe it or not, credit card companies WILL negotiate with you. They won’t just wipe your slate clean with a balance of zero, but they are certainly willing to work with you. You just have to know what to ask for. That’s what I’m here for, so keep reading.

Late payment fees

This one will work about 90% of the time though you have to be careful to use this ace-in-the-hole on occasion. If you ask all the time, they won’t be willing to bend. But if you use it intermittently and ask for a late payment fee waiver, 9 times out of 10, you’ll be granted permission.

There is a specific art form to getting what you want out of having a late payment fee waived, so stay with me here and I’ll walk you through this. There are three crucial steps to making this work for you.

First Step – Pay Your Debt

Let’s say you’ve received a notification that your payment is late. Once you get this, it means your grace period for that particular billing cycle has come and gone. It’s usually around 21 days after your bill has been sent to you.

While it’s not ideal to wait around for this to happen, there are times in our lives where things slip our minds. We set the bill down on the entryway table after bringing the mail in and then the dog starts throwing up on the rug. You dash into the next room to stop the mess before it becomes epic and as you do, you accidentally bump the table where your credit card bill slips down behind everything to the floor. You don’t notice until it’s too late.

Perhaps that’s an extreme but honestly, we’ve all had those kinds of moments in life. Even the people that work at the credit card companies.

So, when you realize you are already late and are outside that grace period, pay that bill as soon as you do. Pay as much of it as you can, but if you can only make that minimum payment, so be it. The key is to pay the bill.

But here’s the other catch…DON’T include that late fee in the payment you send. Once you make that minimum payment and it processes, the only thing that will show on your balance will be that late fee.

Second Step: Activate Auto-Pay

Some people are concerned about auto-pay for something like credit cards because the bills can be unpredictable. But I highly recommend doing this. You can set it up to pay minimum payments or comfortable increments so that if you do have a month where you have to repair your car or handle something important, you won’t go into the negative.

When you set up auto-pay, you never have to worry that the bill hasn’t been paid. If you really can only afford to make minimum payments, you should try to budget and plan better so you’re spending what you can afford. Credit cards aren’t free money. You have to pay it back.

If you have a credit card for a business account, I can’t recommend auto-pay enough. It totally takes the guesswork out of trying to remember did you pay it or not and keeps your credit in good standing.

Third Step: Call Your Credit Card Company

Now, pick up the phone. Give the credit card company a call. I promise it won’t be scary. Remember, if you want to catch flies, you’ve got to use honey. Be polite and cordial and it will go a long way.

It’s a lot easier to get the late fee waived if there are fewer days that you are late. Call customer service and tell them you were charged a late fee. Tell them why your payment was late. Be honest because they’re not going to buy the “my bill didn’t come” excuse every time. They may even laugh if your dog really caused the problem. In business, you could even have had a new receptionist accidentally throw out that bill.

Whatever has happened that caused you to be late, explain it and then ask if they could be so kind as to remove those late fees. They may not agree to it immediately or could ask for further details so be prepared to tell them more. If you’ve never been late before or have seldom done so, they will usually agree to it. Then all you need to do is watch your credit card statement and you’ll soon see the balance return to zero.

Once when I first set up a new card and set up auto-pay, I was told the payment would come out on the 5th every month. On the 5th of that first month, I noticed my payment still hadn’t been made by noon. I called and asked about it and they assured me it would come out by midnight and not to worry.

The next day though, that payment had never posted (even though I had the funds to cover the credit card bill in full). Another call to them and they couldn’t have been nicer. They waived the fee immediately and made sure that error never happened to me again.

I also have a special top-secret tip for you that can really help.

Let’s say you get paid after the due date on your credit card bill. What a pain, right? All you need to do is set the due date to a later date from when you get your pay. Most credit card companies will allow you to set up a date that works for you each month. You can even do it online, though you can also call them up and ask them to walk you through it.

If your credit card company doesn’t have the feature that allows you to set your own due date online, call them and have them set one that works for you. They will almost always accommodate it, especially if your bill is currently paid in full. Remember, your credit card wants your business, and if they aren’t accommodating for setting due dates, you can always use another card.

Annual fees

Annual fees can also be negotiated, though these are just a little trickier. Stick with me and I’ll show you the ropes. Asking to have an annual fee waived might result in a partial reduction of the annual fee, or you could get a one-year waiver out of it. If you’re really lucky, you may even be able to negotiate it away permanently. This will depend on your relationship with this creditor as well as how long you’ve been an account holder.

Think it won’t work? Think again! In 8 out of 10 cases, if you ask for a waiver, you’ll get a reduction on the annual fees.

Your other options to explore are downgrading your card to a version of it that has no annual fee. It will likely have fewer perks, but this is one way to get rid of the annual fee without closing out your account. Chances are extremely good you can at least get a reduction on that annual fee so follow me and let’s discuss how you can make that happen.

5 steps to get your annual credit card fee waived

If you’d like to get rid of your annual credit card fee (who wouldn’t?) here are the steps you must take to make it happen.

First Step: Use That Card

Your bank is going to be much more likely to hear you out on your desires to do away with this annual fee if you use the card often. Customers that make them money are what they prize the most. That doesn’t mean you need to go into debt buying all the things right before you ask, but if you have a steady flow of transactions appearing on your card, you’ll have a better chance of convincing them to waive this fee or at least reduce it. Remember, they want your business. They don’t want you to cancel your card. They have people devoted to keeping you there in the retention department. More on that shortly.

Oh, and when you’re out there spending on the card, remember that you should never go over 30% of what the maximum line of credit is and always pay it off in full. That’s the magic number to follow!

Second Step: Don’t Miss Any Payments

Good customers that pay their bills on time are certainly worth retaining. If you pay your bill in full on time every time, you have an excellent chance of getting what you want. Again, I highly recommend that auto-pay feature for this exact reason. You’ll never be late. And if you pay in full, it avoids accruing interest and other problems.

When you’re trying to get in the credit card company’s good graces, it would really help to be sure you’re not late paying even once. This will help you build a solid case for why they should waive that annual fee for you.

Third Step: Always Negotiate By Phone

I know we’re all in tune with texting and chatting these days, but dust off those old phone etiquette skills and speak to a human at the credit card company. Be respectful and kind as you make your case. But remember, most of the people you’ll speak to only have access to tell you if you’re eligible or not. They’re not required to offer you anything special though but if you’re polite, you can sometimes talk your way into getting them to vary the offer.

The trick here is to build a strong case while keeping your cool, calm, and polite demeanor. There’s no need to get testy and snap and say things like, “Well, I’m going to cancel this card!” You don’t need to lie either to get what you want. Simply remind them of your good standing with the card and timely payments while letting them know you really don’t like paying that annual fee. Then ask them if there is anything they can do for you.

As so many of us are used to texting what we want, it can feel a bit intimidating to ASK for it verbally. So, how do you do that, especially if the first person you speak to says their hands are tied? Screaming at them won’t work (please don’t do that) so your next option is to get them to send you to the retention department.

Remember what I said about that above? That’s the department that is specially-trained to prevent customers from closing their account. They have more authority to work with you and grant your wishes, within reason of course.

An example of what to say to get you to that department would be, “Hi, I couldn’t help but notice that my annual fee is going to be due soon. I’m really not sure I want to keep this card with such a big annual fee on it. As you can see, I’ve been an account holder for a while and I pay on time and have been a good customer. Do you have any offers on this card that you can give me or is there someone I may speak with who can discuss options with me?”

When you are polite like this, they should try to smooth things over and usually will send you right over to the retention department. Once a person in that department picks up the line, get ready to repeat again what you’ve said to the other person in just as kind a voice.

As you repeat this though, after you mention the bit about not being sure about the card being worth keeping, add a compliment. Not like, “Oh you sound like you have nice hair! I love nice hair!” A compliment about the card. Perhaps it gives you a hefty travel credit or 2% cashback or whatever the perk is. After you compliment that feature, then say, “While I love that about this card, I’m just not sure if that perk is worth the annual fee though.” You can also team that with an expression of polite disappointment in any perk that maybe has disappeared since you’ve been a cardholder.

Extra special bonus tip!

Call the credit card company during their regular business hours during the weekdays (Monday through Friday) on the same week that your annual fee posts. When you call really matters, which I’ll explain just below.

Best Time to Call Your Credit Card Issuer

During those weekdays, the best time to land in the retention department is between 9am and 10am for EST. The more experienced reps tend to work earlier in the day during the week. Your goal is to try to get one of those people to help you because they are more motivated to help. Plus, they have a better knowledge of what they can offer you, thus giving you a better bonus.

When you call early enough, you catch them when they’re bright-eyed and bushy-tailed, ready to start their day off with a win. Remember, their job is to keep you from closing your account so they’ll want their day to start off on a high note.

Waiting later in the day means you likely get someone less experienced or worse, someone that’s had a terrible day being mistreated by people who can’t seem to mind their manners on the phone. Even if you’re polite, the damage is already done and they’ll be less inclined to fork over incentives for you to stay.

One important tip to know: banks keep records of these calls so don’t hang up and call again as it might not always work. Still, it never hurts to try if you didn’t get the result you want and call back again another time. Just like with anything else, the worst answer you can get when you want an offer is ‘no.’ Which brings me to my next point…

Fourth Step: Call Again If You’re Not Satisfied

This doesn’t just work with credit cards but with other services too. If you didn’t get the result you were after, and assuming your account is in good standing, go ahead and call again. You might be able to get someone else that can help. Sometimes when you call, you’ll be told there is no offer currently available. Call back again though, especially if everything on your end is solid (timely bill payment, less than 30% of credit line utilization, etc.). You can even try five minutes later and get someone else who is able to give you the kind of offer you’re looking for.

Fifth Step: Don’t Worry About Timing Your Annual Fee

It’s not too late if you already paid your annual fee, whether you just did it last week or you did it six months ago. If you can, try to catch it before you pay it though. Regardless, you can still get offers to even things out.

I recommend trying to stay ahead of things and give a call before that fee is due. You’ll get great results if your account is in good standing. There are people that call right after the signup bonus posts though, and you should be very careful if you try this. Banks close the accounts of customers that they find to be problematic, and this would certainly qualify. You want the bank to work with you and give you more incentives, not cut you off.

Something I recommend even more is to call your credit card company after that annual fee is posted on your bill but before you pay your bill, without being late on your payment. So, let’s say your credit card bill has just arrived in the mail and you’ve been minding your p’s and q’s this whole time. The new balance plus the annual fee is due in a few weeks. But pick up that phone.

Remember, your creditor has no incentive to waive annual fees when you’ve already paid it. They never refund it or give out bonus points because they have your money.

And while I am a big fan of auto-pay, you should keep an eye on your account for that annual fee. If you don’t want to pay it, you will have to keep tabs on when that fee applies and make your case before that auto-pay comes out.

Credit card interest fee waiver

And now, one of the most important things you can negotiate is an interest fee waiver. This is for any of you that have credit card debt. Because without negotiating down that interest, it’s going to be difficult to pay off your balance.

This is why you should be careful when you’re offered 0% interest for 18 months for example. If you can pay your balances comfortably, it’s no problem. But if you wind up with an unexpected expense after that 18 months, you may very well find your interest rate has shot up to something obscene, like 21.5%. Ouch!

Even if it goes to a relatively low APR, like 4.5%, that few extra points can cost you hundreds of dollars or much more over the time you have that card. When you pay what you owe monthly in full, APR doesn’t affect you. When your refrigerator stops working, your car breaks down, or you’ve got to suddenly fly to see a dying relative, those unexpected costs can cause us to break them down into manageable chunks known as minimum monthly payments. And THAT is where the APR can come in and do some serious damage.

But I have good news! Roughly 7 out of every 10 people that as for a lower interest rate have their wishes granted. There’s no need for a magical genie to help you.

Read on and I’ll show you how to make a lower interest rate happen!

Here’s how you can negotiate a credit card interest fee waiver

If your interest rate is high, even if you’re paying on time, it pays to negotiate it. You never know when an emergency will arise that will necessitate your having to pay only the minimum due. Here’s what I recommend for being among the 70% that negotiate a better interest rate.

Shop around for better interest rates

You can try calling up and asking but a simple, “Pretty please with sugar on top” might not cut it. You’ll likely have to prepare for negotiations. Don’t be intimidated because you have the upper hand here. See, it’s expensive for credit card companies to lose customers. Now that you know that, you can leverage it to your advantage.

Before you engage in these negotiations though, do a little homework. Get your numbers in order in front of you. You should know what your current balances are. You should also be prepared to mention how much interest you’ve paid during the last year. This way, you can explain to the rep why they should give you a better interest rate.

But that’s not all. You should also see what other lower-interest cards are out there and keep any offers you’ve received from your inbox or your mailbox on hand. Make a sheet of notes so you’re not fumbling through the papers and losing your confidence.  Remember, if you can give them a good reason to keep you on and show them that other companies are offering you more perks and a lower APR, you’re likely to get exactly what you want.

– Become the most desirable customer around

For those issuing credit cards, they want to keep their best customers. If you don’t pay on time or have some blips, now is not the time to ask. You should then step back and focus on making yourself the kind of desired customer a credit card company wants.

Having a good credit score is one thing that can really do the talking for you. It shows you can handle your debts and are responsible. If you have a FICO score of 670 or higher, you’re golden. If your score isn’t this high, work on getting it to that level. Then you will likely have better ground to stand on when negotiating. Depending on your card, your credit card issuer may require that score to be higher. If you have a score of 740 or higher, it is extremely unlikely you’d be told ‘no’ during your negotiations for a lower APR.

If you can’t say good things about your credit score, now isn’t the time to ask. You can try, but you’ll likely be turned down. Instead, take a year to make sure all payments are made in full (or paid down significantly) and on time.

– Call and request that lower rate

When nothing is ventured, nothing is gained. If you want a lower rate, call and ask for it. Remember, the worst thing they can say to you is ‘no.’ Make sure you’ve checked to see if you’re in good standing and that you have any offers from other cards on hand to name-drop during the call.

It’s simple but it works in most cases as long as you’re not a problematic cardholder. So many people are so afraid of being rejected that they fear to pick up the phone. Just call, and ask to speak with a manager. Maintain your air of politeness the whole time, no matter who you’re speaking with. Proper manners go a long way, believe me. See what I mean below and keep reading!

– Be polite and persistent

There’s that old motto about trying again if you don’t succeed the first time around. That doesn’t mean be a pest, but rather, keep at it. Be kind and pleasant as you do. So, for example, if the first person you speak with tells you ‘no,’ then kindly ask if you can speak to a manager. Don’t give up until you get a rep that is willing to help. I don’t recommend calling them every single day but do keep up with calling them throughout the next few months. You don’t want to overdo it and wind up on their blacklist.

Kindness though is important. These people are like you, working a job. Being polite and friendly really does go a long way. You wouldn’t believe how many people call up and are rude when they have complaints. And speaking of that, if they did make an error on your account, don’t ever scream or be rude. By all means, let them know you’re unhappy and that you realize it’s not that person’s fault so you can get them to come around to your side.

Still lacking confidence in making that call? Here’s what you should say:

“Hi, this is (insert your name here). I’ve been your customer for (insert amount of years here), and I’d really love to get a lower interest rate on my card. I’ve been making my payments on time every month and I spend (insert amount) every month (or year) on this card. I was just offered a new card with (name of competitor you’ve recently received an offer from). It’s like your card but they’ve got a lower interest rate at (insert the lower rate of the competition’s card). Because we have a history together, I’d like to stay with your company but I am really motivated by this other offer. Would you be able to match their offer for me?”

Again, if you’re in good standing, it’s very unlikely you’ll hear a ‘no’ on that one, especially when you say it politely.

The alternative: Consider a balance transfer

For those of you with concerns of lowering your interest rate, you should take a look for a card that has a balance transfer deal for new customers. This would enable you to shift your balance from the card you have to a new one, typically with no interest during that intro time period. By doing this, you can buy yourself anywhere from 12 months to 18 months to pay down your debt all without any interest.

Be forewarned though that balance transfers almost always require some sort of fee. Usually, that fee is around 3% to 5% of the balance that you are transferring. For example, if you transfer a balance of $1,000, you will pay $30 or $50 with those example fees. That added cost might well be worth it though if it buys you time to chip that balance away with no additional interest accruing.

If all else fails, get a personal loan at lower rates

When nothing else works out, you can always try for a personal loan. This could give you just what you need to put as a deposit into your bank account. But don’t be lulled into a false sense of confidence here. Just ignore that money except for paying off your credit cards. To spend it on anything else would land you in more debt that you’ll have to pay off. It’s not free money!

Once your funds clear for the loan, pay every credit card you have off in full. Use the online bill pay from your bank, mail a check, or go to the credit card’s website and pay there. Pay them off as quickly as you can and you’ll stop accruing more interest. Then, once everything is paid off, tuck your cards away so you won’t spend on them unnecessarily again.

Penalty rates

I’d like to take a moment to address penalty rates. If you have one on your card, that’s a big problem. This is why it’s so important to make your payments on time. These penalty rates are often at 30% or more. They’re typically applied when you’re late with a payment by 60 days or longer.

If this is your current situation, keep calm and keep reading. I’m going to walk you through how to get yourself out of this sticky situation.

How to get rid of your credit card penalty rates

Penalties tend to stick for a while, but if you make 6 timely payments consecutively after that penalty rate has been added, the trusty Credit CARD Act of 2009 requires that the issuer of your card review your account to get your old rate restored.

So, what you need to do here is pull up your bootstraps and make those payments on time, and do that EVERY time. Your situation won’t change until you do. After making the payments, give the card company a call to ask when they’ll review your account. I can’t guarantee they will decide to reduce it but if you are polite about it and show your good intentions, you will likely have good results.

But those results won’t happen before six months. So, get your situation balanced back out and then you’ll find things are going your way.

You may also be able to reduce or avoid balance transfer fees

You can try, though it’s not very likely to get it. Ask for a match or a waiver. Again, the worst thing you’ll be told is ‘no’ but it never hurts to ask.

Honestly, you’ll have to review the terms your credit card company has in place and the amount of the debt that you transfer over. It helps to look at this as a math problem, if you will. Perhaps you’ve got a $2,000 balance you want to transfer. The card you want to transfer to charges a balance transfer fee of 3% of that amount you transfer (or $5, depending on whichever is greater). So, in this example, your balance transfer fee would be $60.

But review what cards offer you! Other cards could charge a 5% balance transfer fee for transfers you make after the first 60 days of opening that account. That means that BEFORE that time, there is NO fee. So that same $2,000 transfer will mean you pay nothing. Read the terms and shop around for your best deal. You can ask your card to match it or waive it. Again, good credit scores can really help, but if not, at least it’s worth asking!

How to avoid foreign transaction fees when using credit cards

Does your card have foreign transaction fees? It’s probably not a big deal if you never leave the country. But what about when you take a vacation or have to do more travel outside your own borders for business as I do?

Those foreign transaction fees are a huge pain. Many cards charge them which can tack on an additional 3% to the cost of your transaction. But many cards are starting to waive those fees, especially those for higher tier travel cards. The tradeoff here is that they have larger annual fees.

If you’re a big traveler and have excellent credit, you likely have cards that waive these annoying fees. For those of you starting out into the credit world, you might not have those kinds of cards or you just don’t do much international travel. So, what can you do?

Thankfully, there are many cards now that don’t impose foreign transaction fees which are aimed at every type of customer. If you think you might be traveling more outside of your own borders, apply for a credit card that has no annual fees and doesn’t charge any fees for foreign transactions.

But there’s a caveat here and that’s this: say you’re planning a trip to one of the nearby foreign lands, like Mexico or Jamaica. If you’re planning on spending around $1000 on your card and it charges a 3% foreign transaction fee, that’s only $30. Meanwhile, if you apply for another credit card, you get that credit inquiry on your history. It might just be worth it to pay the fee. However, if you want to start making travel a regular thing, you should certainly look into a card that won’t impose fees.

You just never know! I had a friend who one day up and decided to move to South Korea. He was lucky because he had a card that didn’t have foreign transaction fees, so he was able to use his card as needed.

Not sure where to find credit cards with ZERO foreign transaction fees? Hey, I won’t leave you hanging. Look below and you’ll find my handy table for credit cards without foreign transaction fees

List of credit cards with no foreign transaction fees



You might think you’re stuck with the fees and rates your credit card imposes, but that’s not always the case. When you have good credit and pay on time, you can negotiate many things in your favor. Banks and credit cards want you to stay with them and be a customer. You have the advantage here.

If you’re struggling, get yourself back on top by following my tips and making your payments on time. Once you fix this, everything will fall into place and you’ll be able to breathe a sigh of relief!


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