Facing Financial Challenges? Ask Your Credit Card Provider for a Lower APR

The COVID-19 pandemic has caused a lot of financial stress for many people in the U.S. During economic downturn — like the one caused by the pandemic — many people are forced to rely more heavily on their credit cards. But before putting that kind of stress on your credit, you should inquire whether you are eligible for a lower annual percentage rate, or APR.

“Credit cards can be a great tool during times of financial uncertainty,” said Lyndsay Clark, VP/Retail Banking Manager at First Security. “If you are experiencing any kind of financial hardship, whether it’s caused by the pandemic or something else, one of the best things you can do for your finances is to seek out a lower interest rate to keep from plunging too deep into debt.”

How to Negotiate for a Lower APR

Achieving a lower APR on your credit cards can be as simple as making a phone call. Start with your oldest credit card and call the customer service number to see if you qualify for a lower interest rate. Following are some tips on how to convince the company to lower your APR.

• Know your options — Determine the APR offered on other credit cards. Your credit card company won’t want to lose your business, so if they know you’ve been comparison shopping, they may be more inclined to offer you a lower APR.
• Loyalty matters — If you have used a specific credit card for a long time and are in good standing, the credit card company will not want to lose you as a customer. When requesting a lower APR, make sure to remind them you are a valued customer.
• Aim for below the average — Research the average APRs credit card companies are charging. For example, in June, U.S. News reported that the average APR for all credit cards ranged from 15.49% to 22.61%. APRs vary depending on the type of card you have, however, so find out the average minimum APR for the type of card you have, and request an APR below that number.
• Don’t take no for an answer — The worst thing that can happen when requesting a lower APR is they say no. So, if they say no, call back another day and ask to speak with a supervisor. Keep trying to negotiate until you get the result you seek.
• Rinse and repeat — Call the customer service number on each of your other credit cards and follow the same process.

After all that, if any of your credit card companies refuse to lower your APR, apply for a card with a low or 0% introductory APR, or transfer your balances to a card with a low or 0% promotional rate to help you weather the storm of the financial challenges you’re facing.