Consumers Able to Negotiate Lower Interest Rates With Credit Card Companies as Card Lending Rebounds

SAN FRANCISCO, July 19 /PRNewswire/ -- DebtGoal™, the leader in online personal debt management, reports that the thawing credit climate has translated into an improved ability to negotiate lower interest rates with credit card issuers. Since its launch in May, 67 percent of those negotiating their credit card interest rates have successfully negotiated lower rates by following the program on DebtGoal's free NegotiateMyRate™ tool (www.negotiatemyrate.com). This represents a dramatic improvement over the same period in the previous year when the average success rate among negotiators was 12 percent. By issuer, average rate reductions are as much as 14.4 percent, with an average rate reduction of 9.3 percent. Capital One, Discover Card, USAA, Chase and Wells Fargo are the issuers most likely to negotiate rates to keep their cardholders happy.

By crowd-sourcing results, NegotiateMyRate leverages its large community of members to track the results of previous negotiations and display these results to other borrowers, empowering them to negotiate more effectively with their lenders. NegotiateMyRate provides a script for first-time negotiators, shows consumers how much they can save at a lower rate over time and reveals the success rate for previous negotiation attempts. NegotiateMyRate also integrates with Facebook, allowing users to post their results and share their best tips and tricks for negotiation.

DebtGoal first began providing consumers with scripts for negotiating with credit card company representatives when it launched in 2008. During the credit crunch however, card issuers rarely negotiated lower rates, granting rate concessions to only 12 percent of callers.

"The credit card industry shifted almost overnight. Card issuers that had previously competed for consumers with cash bonuses suddenly lowered credit lines, decreased card solicitations and refused to negotiate interest rates. It's great to see things finally turning around," DebtGoal CEO Scott Crawford said.

Crawford speculates that as the credit crunch eases, issuers are once again focused on growing balances and retaining customers and are more willing to negotiate with cardholders who threaten to switch unless given a lower rate.  

"The increase in success rates suggests the market is improving and issuers have returned to competing for balances. It's a big change compared to this past winter when card companies were fully focused on clearing the books and even paying customers to close accounts," Crawford said. "Given the current climate, everyone with a credit card should call and demand a lower interest rate today."

Despite the fact that credit card users can save hundreds or even thousands of dollars in interest payments by negotiating a lower rate, most don't take advantage of the opportunity.  A recent study found that although 93 percent of credit card users know it's possible to negotiate lower interest rates with their credit card providers, 65 percent don't bother.*

DebtGoal helps people save money by getting out of debt faster. The site offers tips, tricks and guides for finding "extra" cash to help pay down debt faster. Its progress trackers keep consumers motivated by showing how they track against their target debt-free date, and the online community gives people a forum to share their debt challenges and successes. Taken together, NegotiateMyRate and Accelerator Actions combine to provide a holistic system that helps borrowers understand their financial tradeoffs, make decisions that are aligned with their goals, and create a plan that can save them thousands of dollars in interest and take years off of their debt.

Comments from successful NegotiateMyRate users can be found at: http://www.negotiatemyrate.com.  

* Source for Lending Club Consumer Credit Survey findings: http://tinyurl.com/26r29ty

About DebtGoal

DebtGoal is the industry leader in online personal debt management. Targeting the do-it-yourselfer, DebtGoal is helping its members organize, optimize and pay off nearly $1B in debt with its proprietary SmartPay Plan™, which calculates an optimal pay-down plan based on a member's preferences and budget. With its low monthly price and focus on helping subscribers build credit by repaying what they owe, DebtGoal represents a dramatic departure from previous debt solutions that charge high fees or significantly harm credit.  For more information about DebtGoal, visit http://www.debtgoal.com.

SOURCE DebtGoal