Negotiating Better Credit Card Terms

Negotiating Credit Card Terms

Stiff competition among lenders has made negotiating better credit card terms much easier. Many cardholders do not approach their issuer to ask for a credit limit increase, fee waiver, or lower interest because they assume the terms they agreed to can never be changed. However, there is room for renegotiation. Most banks are willing to change credit card terms, but the only way to know for sure is to ask.

Credit card terms you can negotiate

Most consumers are unaware that credit card companies already have rules in place for adjusting the terms of credit card agreements. For instance, many banks will waive a certain number of late payment fees each year for existing customers in good standing.  Banks that issue credit cards are actually flexible when it comes to changing terms in favor of cardholders with a consistent payment history.

Taking the initiative to negotiate better credit card terms doesn’t cost anything and can save a great deal of money.


- Determining Factors

- Credit Limit Increase

- Negotiating Rates and Fees

- Inability to Pay

Credit Card Terms Determining Factors

Some consumers do not attempt to improve the terms of their credit cards because they are unsure how the lender decides one way or the other. There are certain factors that determine whether a card company will increase the credit line, skip annual fees, or waive late charges. Depending on the customer, banks will adjust these and other terms such as lowering interest rates and balances. 

In most cases, the card company will consider the following:

The customer’s use of the card.

  • The issuer looks at whether the card is consistently maxed to the limit. In addition, they want to see that the card is being used for or if the account is dormant.

Consistent on-time payment history.

  • Paying more than the minimum due shows lenders the borrower is most likely trustworthy.


  • The creditor takes into consideration any change in income since the account was opened.

Relationship history.

  • Long term cardholders or those with other accounts with the bank will have a better chance at success in negotiating better terms.

The approach to the request.

  • Cardholders that demand changes to their terms are less likely to win the cooperation of the lender.

Even if all of these factors are favorable, there is no guarantee that the credit card company will change terms at the request of the cardholder. Credit card issuers are not legally obligated to make changes to a credit card contract. Decisions are made on a case-by-case basis; the issuer is free to approve or deny at their discretion.

Credit Limit Increase

Consumers should take a strategic approach when considering asking for a credit limit increase. There are instances when an increase is appropriate in order to meet certain needs. For instance, a growing small business can outgrow its initial credit limit. Higher credit limits come with both pros and cons which include:

1. A higher limit leaves room to pay for unexpected or costly expenses.

2. Paying off higher debt proves financial responsibility and may increase credit score.

3. Increasing an existing credit line avoids opening new credit accounts.

1. Using the additional credit can lower credit score.

2. The limit increase request is like a new loan, which results in a hard pull on the credit report.

3. For some consumers, an increased limit is a temptation to overspend.

Borrowers should know how much more they can afford to ask for prior to requesting a credit limit increase. A sound financial strategy also includes taking an honest assessment of whether more credit is really needed. Before the request, the cardholder should assume they will receive the increase and use this mindset to weigh out the pros and cons ahead of making the commitment. 

Negotiating Credit Card Rates and Fees

Although there is no certainty of approval, there are ways to improve the chances of getting a “yes” to changes in a credit card agreement. There are actions the cardholder should take before contacting the issuer to ask for lower interest rates, fee waivers, or other changes. Once the borrower is prepared, it becomes easier to haggle with the lender for more suitable terms.

A few tips for successful bargaining:

The cardholder should check their credit report for late or missed payments on all of their credit accounts before contacting the lender.

It is unreasonable to expect a compromise on an account that has not been current for at least a year. Wait at least that long before approaching the issuer.

When requesting an annual fee waiver, the borrower should inform the issuer that they want to keep the same account numbers and any accumulated rewards rather than get a new card.

Zero balance transfer offers can become a bargaining tool. One tactic is for the borrower to politely inform the issuer that they are considering closing the current account and opening a zero balance card with a competitor.

Discuss requests with a credit manager. Customer service representatives do not have the authority to make changes to credit card agreements.

Borrowers should either be prepared to walk away or accept a “no” answer to their request. Making idle threats with no intention to follow through is a losing situation for both sides. In some cases, sticking with the original credit card will cost less than paying for balance transfer fees. Alternatively, if the issuer flat-out refuses any changes, finding a new credit company might be a better option for a loyal customer.

Inability to Pay a Credit Card Bill

Sometimes negotiation with a credit card company is needed because the borrower is unable to pay. The way to approach the issuer depends on whether the situation is temporary or permanent. Either way, it is a very bad idea to ignore the debt. Borrowers with problems paying their credit card bill should communicate with the creditor to make arrangements as soon as possible.

Pay for credit card bills

Contacting the card company and working out a resolution is a far better option than filing for bankruptcy. Creditors are often willing to work out a solution that works best for both parties. Borrowers should be prepared to explain the changes in their finances that caused the delinquency. They should make it clear that they want to repay the commitment but will need to make arrangements to do so.  

Change credit card terms

In addition:

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    The borrower should make it clear whether the financial situation is temporary or permanent.

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    It does not hurt to ask the card company to drop late fees and limit overage fees to reduce the debt.

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    The issuer may offer a debt settlement. The borrower should know how much they can afford to repay (and be prepared to pay it).

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    Patience is a key to negotiating success. It may take several attempts to get the card company to agree to make arrangements.

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    Before giving up, borrowers should exhaust all options to appeal if the company declines to make arrangements.

If all else fails, borrowers can sign up for a debt repayment plan. Most credit counseling agencies have relationships with creditors. Pre-negotiated rates and fee reductions are available for clients that sign up with credit counseling. Administrative fees and terms differ between counselors, so consumers should shop around before choosing an agency

Since issuers are in business to make money, they are usually willing to make concessions for their best customers. Cardholders should leave nothing to chance. Rather, they should come to the bargaining table with specific and reasonable requests for changes in the terms of their agreement.

In all probability, a ton of eligible credit card customers do not have optimal terms simply because they do not ask.

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Sheila Kay

Sheila Kay is an author, ghostwriter and editor residing in the Atlanta, GA area. Among her favorite writing genres are creative nonfiction, self-improvement, and finances. Her first published book, PTSD and the Undefeated Me, is a memoir which has been a stepping stone to her involvement with mental health advocacy for military and civilian men and women. She is currently working on the first fiction novel to be published under her name. For more information or to purchase her books, visit Sheila’s Author Page on