Your credit is more than just the plastic card sitting in your wallet. While credit cards can play a role in establishing your financial record, credit by itself is better defined as a bank’s trust in you to repay a loan. Hopefully we can all reach the point where we have enough cash and that we don’t have to depend on credit. Until then, here is a script I’ve made with several trial and errors phone calls to several of my credit card’s companies.
The importance of increasing your line of credit is not to have more money available to you but to have your debt limit ratio closer to the ideal limit of 15%. If you have a credit card with a $10,000 limit the ideal amount of debt you should have to boost your credit would be $1,500. Follow this script word for word and be sure to call back every 3 months or 6 months depending on how often you are allowed to increase your limit (AMEX will only increase credit limit every 6 months.) How much of an increase should you request? If your credit is currently less than $10,000 ask for triple the current amount (e.g. $1,000 credit increase to $3,000). If your credit limit is currently more than $10,000 ask for double the current amount.
STEP ONE: Increasing Lines of Credit
Student: Hi, I’m calling to make some adjustments to my card. First, what is my credit limit?
Operator: Your current credit card limit is $_____________
Student: I’m going to be making a significant purchase and rather than using more than one card, I would like to use this as my primary credit card. In order to do so, I will need to raise my limit.
Operator: How much would you like?
Student: What are you authorized to offer me? (If they offer less than you are looking for, continue to negotiate through Steps Two and Three, then ask to speak to a supervisor, outlined in Step Four)
Student: I would like to increase my limit to $___________
Operator: I can raise your limit to $________ (If this is acceptable, move to Step Two)
We will get back in touch in 72 hours, etc.
What can you do for me today?
*If their response is not acceptable to you….
Student: Thank you for your assistance. Now, I would like to speak with a supervisor. (Return to script and begin again)
STEP TWO: Decreasing Interest Rates
Student: What interest rate am I currently paying?
Student: I would like that interest rate lowered immediately.
*If they do not decrease your interest rate to an acceptable level:
Student: (use this technique only if you receive offers in the mail) I’m confused…. I received an offer in the mail for ___ percent interest. I realize this is an introductory offer, but in order for me to be comfortable using this as my primary card, I would think you could be more competitive.
Operator: We could go down to _______ for ________ months.
STEP THREE: Eliminating Annual Fees
Student: Am I currently paying an annual fee for this card?
Operator: You are paying $_______ per year.
Student: What benefit(s) am I receiving for this fee?
Operator: You are receiving___________________.
*If you are paying just for the privilege of holding the card
Student: I would like that fee credited and discontinued.
STEP FOUR: Negotiating with a Supervisor (When Negotiations are Unsatisfactory)
Student: Thank you for your help. Now I would like to speak to a supervisor.
*When Supervisor gets on the Line:
Student: Hello, I have been speaking with one of your representatives, but I need some additional assistance. (Continue negotiations, beginning with Step One, as appropriate)
Remember now that you have lower interest rate and a higher credit limit this does not mean you should go out on a spending spree. Focus on eliminating debt and building assets. Personally whenever I receive an introductory offer from a credit card (e.g. American Airlines 35,000 miles for signing up and spending $1,000 in the first three months) I always sign up. I pay off the debt I have on the card and then I leave the card with the other stack of credit cards I have like Nordstrom, Amazon, Bestbuy, and more. I leave it in a drawer and never use them. I don’t throw them away because if there is ever a time where I need $100,000 I can always rely on the stack of credit cards I have in my dresser drawer!