How To Negotiate A Lower Interest Rate On Credit Cards

December 4th, 2017 | By Paul Paquin

Depending on if a person is behind or current on their monthly payments, will help to determine the best route for them to take. Today, I will run through a few scenarios: 

A. If you want a lower interest rate to save money and get out of debt faster because you’re current on monthly payments and your credit score improved from when you were initially approved for the credit card. 

B. If you need a lower payment because you’re experiencing a financial hardship and trying to avoid falling behind on payments. 

Using credit card at ATM

Before negotiating a lower rate with your creditors, it’s important to understand why credit card companies give high interest-rates in the first place:

Credit card companies inflict a high-interest rate on someone who has a low credit score, to protect themselves if that person eventually stops making payments and disappears out of the country. 

When you first applied for the credit card your credit score was probably lower than what it is today, due to your perfect payment history over the years. 

Now that you have a higher credit score, you impose less risk to the credit card company – and therefore they owe you a lower interest rate.

Your creditors owe you a lower interest rate if: 

Your credit score improved from what it was when you initially were approved for the card.

You’ve illustrated perfect payment history over the last 12 months. 

If you pass those criteria; then yes definitely make the call and request a lower rate.

How to call the credit card company or bank to negotiate a lower rate:         

The best way to approach the situation would be for you to call the creditor and; 

    Before calling, research their competitors: Find a credit card company that is offering “a 0% intro balance transfer APR for 18 months”. You will integrate this detail into the script that you use when calling the bank or credit card company.

    Gather the details of your past payment history: How long you’ve had your current card for, how much your credit score has improved by, and any other pertinent details that you can assemble to help strengthen your case on why the bank should lower your rate. 

    Call your creditor and ask to speak with a supervisor: The conversation should sound something like this: 

“Hi ___ (make sure to write down the representative’s name and keep detailed notes), I’ve been a customer for eight years and two months now (give date: I was approved for this card on January 18th, 2013) -- and was never late on my monthly payments. My credit score was only 670 when I first applied for this card, and now has gone up to 720. 

Citibank is offering me an interest rate of 0% if I do a balance transfer to their card, but I would much rather stay with you guys. You guys have always treated me fair, but at this point, I need the interest rate reduced to be able to stay with you. Since I’m now a lower risk client and have established a perfect payment history with your bank, would you please lower my interest rate by 8% and that would help me to pay off the debt within 5 years which is when I retire?” (always shoot lower than you want to go when negotiating, so if your goal is to have them reduce the rate by 5% then request that they lower it by 8%)

Results may vary: The good news is; if you don’t succeed, you could call back tomorrow and speak to another supervisor, and succeed! Results may vary depending on who you speak to that day. Some supervisors will go to battle for you harder than others.

Is it a good idea to call the credit card company and request a lower payment? 

Yes, it is and here’s why: 

Let’s suppose you have a 25% interest rate on a credit card and the balance is $25,000. If you can only afford to pay $600 per month on that card – it would take eight years and three months to pay it off, and you would end up paying a whopping $58,937 (including interest) in the end. 

After the credit card company lowers the interest rate from 25% down to 18%; now you could pay off the card within five years and six months if you continued paying $600 per month -- and only pay a total of $39,527 in the end. 

So just by lowering the interest rate from 25% down to 18% -- You can save $19,410. 

Figures provided by the debt calculator at

Woman making a phone call

Can it harm you to call your creditors and try to lower your interest rate?

You could have a small drop in your credit score if your creditor runs your credit report before lowering your interest rate. But even if five credit card companies run your credit within the same month, it would only count as one inquiry and would not lower your score by more than five points. 

If you can get your interest rates reduced, it’s well worth it. You can then pay down your balance faster and quickly improve your credit utilization ratio which will then raise your credit score by more than 5 points!

Can’t afford your monthly payment and need the interest rate and payment lowered?  

1. Prepare before calling: Make a budget analysis so that you can provide the Supervisor at the credit card company all the details about to your budget. 



$2,500 per month 



Show the bank your expenses are exceeding your income, illustrating to them that if they don’t work with you-you will fall behind on payments. And send a copy of your budget analysis to the supervisor you are on the phone with. Let them verify everything that you’re saying. A supervisor can provide you their email address so that you can email them a copy of your budget. 

At the very least, ask them for a short-term reduction in the monthly payment and interest rate (6-12 months). 

Explain to them:

You’ve reduced all your other bills, and this is the last item that you need to figure out how you're going to pay. You’re requesting the $600 monthly payment, get reduced to $300 per month, to be able to remain current on payments. Even if they only go down to $450, you still succeeded.

2. Use their competitor: Let them know that Citibank is offering you a 0% intro balance transfer APR for 18 months, but that you’d rather stay with them. 

Trust me, they don't want to lose you!

Express your interest and desire to stay with them, but that they need to lower the payment to be affordable.  


 3. Once the creditor agrees, get written confirmation: 

Always get everything in writing when negotiating with creditors over a debt. Creditors are not the most trustworthy people to deal with. There is a chance you make a verbal agreement over the phone, and then never hear back from the creditor again. You then call the creditor back, and they know nothing about the deal you're referring to. Make sure to write down the name and direct extension of the supervisor you speak to, get a confirmation number and an email confirming everything in writing. 


Paul J Paquin has been specializing in credit card and student loan relief for over fifteen years now -- as the CEO of Golden Financial Services. Paul is also the author of a best selling book called "Debt Consolidation to Become Debt Free" that can be purchased on Amazon. Paul takes great pride in helping people with improving their finances by reducing and resolving "unsecured debt". Paul is IAPDA and AFSLR certified and accredited.