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In the days before the credit crunch, it was possible to get your credit card issuer to do nearly anything if you used the appropriate negotiation tactics and/or threatened to close your account.
Today, it’s not nearly as easy. But it can still be done.
Many people have reported success with getting annual fees on credit cards waived — especially with charge cards issued by American Express. Since American Express has some of the highest annual fees for their cards — and some of the best benefits to go along with them — this can save cardholders hundreds of dollars a year.
Here are some expert tips to have your annual fee waived:
Make sure your account is in good standing, and has been for at least six months. – Six months seems to be the historic guideline credit card companies use to judge what kind of customer you are. For instance, if you make a late payment, you may have your interest rate raised to the default rate for six months. If you show on-time payments of more than the minimum (or better yet, payment in full) for the full length of the account, or even for a year, this is even better, of course.
Don’t carry a balance – Of course, with an American Express charge card you must pay your balance in full every month, so you obviously won’t be carrying a balance when you negotiate. With other cards, however, you’re in a much stronger bargaining position if you pay your balance in full every month. You are the kind of customer the credit card companies want to keep!
Use your card – You don’t want to carry a balance, but you do want to show a history of being a loyal customer and using your card frequently. Otherwise, the credit card company has no incentive to keep you as a customer anyway.
Get the right person on the phone. – Many times, the individual you want to speak with is in “account retention.” After all, your plans are to cancel the credit card if they won’t waive your annual fee, right? Sometimes, just asking for a supervisor is all it takes, but don’t be afraid to escalate the call until you get someone who will accommodate your request and waive your annual fee.
Don’t accept alternatives. – Your credit card company may offer to switch you to a different credit card with a lower annual fee or no annual fee. That is not what you want. After all, you want to maintain all your current benefits and the rewards structure that goes along with your credit card and have your annual fee waived — not downgrade your level of service.
Stay calm, cool, collected and certain of your victory – In other words, use good negotiation tactics and remember that your victory will depend on your confidence and certainty. Keep in mind that the company has more to lose than you do. They want to keep you as a customer. You don’t want to pay an annual fee. You can both win if they waive your fee.
Bluff about canceling your account — but also be prepared to do so. – Canceling an account is often the last resort if you are paying high annual fees on a credit card. Of course, use this threat as a powerful negotiation tactic — it’s really the only ace you’ve got up your sleeve. But before you actually cancel the account, weigh the damage to your credit score against the cost of the annual fee. It won’t hurt as much to cancel a newer account, but if you’ve had your card for 20 years, and the company absolutely refuses to waive the annual fee, it’s time to start using all the benefits you’ve been paying for… or simply call back again another day, and continue calling, until you get the right individual on the phone… the person with both the power and inclination to waive the annual fee on your credit card.