2010 August Keep Punching Newsletter

Can I Lower the Interest Rate on My Credit Card?

The simple answer is: It never hurts to ask. A study conducted by the U.S. Public Interest Research Group found that more than half (57%) of those who called their credit card issuer and requested a lower interest rate were successful. On average, the rate was lowered by between 7 and 10 percentage points.

Now that most of the provisions of the Credit Card Act (signed into law last May) have finally gone into effect (as of February 22, 2010), there is no better time to review your own credit situation with an eye toward making improvements.
Getting to Yes

Your chances of getting a lower rate are improved if you meet most of these qualifying factors:

  • Good credit rating. A good rating applies both in terms of your payment history with the card issuer and your overall credit score. You are entitled to a free copy of your credit report every year from each of the three major credit-reporting agencies: Experian, Equifax and TransUnion. To save time, log on towww.annualcreditreport.comto access reports from all three. For a small fee, these agencies also provide personal credit scores.
  • Low card balance. You have a history of paying off the entire balance or paying more than the minimum required each month.
  • Track record with card issuer. You have held the card for a year or two before requesting the rate change.
  • Your card is not classified as “subprime.” The credit card is not marketed solely to consumers with bad credit.
The Law of Averages 
To negotiate successfully with the credit card company, you will have to be prepared. Know what your current interest rate is and make sure that it is not a promotional rate that will expire within a matter of months. Also research what other banks and credit card companies are charging their customers. According to the Federal Reserve, the average interest rate on existing credit card balances is approximately 13.5%.
If you are paying significantly more than that and have done your research, you are ready to make the call. Be sure to remain upbeat, confident and persistent. If the first person you speak with turns you down, ask for his or her manager. Base your argument on logic and facts and politely threaten to take your business elsewhere unless you get some satisfaction.
Remember, the better your payment record with the card issuer and the higher your credit score, the better your bargaining position.
One final word of advice: Be careful about getting overly zealous in your search for the lowest rate card. Applying for multiple new cards at the same time (three or more inquiries in one month) could cause your credit score to be lowered.
Doing Your Homework
 
Visit these Web sites for competitive rate information and more.
 
This article was prepared by Standard & Poor’s Financial Communications and is not intended to provide specific investment advice or recommendations for any individual. Consult your financial advisor or me if you have any questions.
 

What steps can I take to help me sell my home in a depressed market?

You may be able to sell your home in a depressed market by pricing it appropriately, conducting necessary repairs before your home is officially listed for sale and making your home as attractive as possible. The process may start several months before the house formally goes on the market. The key is to view your property objectively as a potential buyer would.
Structural Repairs. Take an inventory of items that are broken or outdated and could potentially emerge as issues during a home inspection. Windows or doors that will not open easily, peeling paint, shingles falling off a house or garage and similar issues convey the impression that the owner does not pay attention to a property. By fixing these or other items before putting the house on the market, you are eliminating something that a potential buyer could use as leverage in negotiating a lower price. If you forego repairs and attempt to sell your house as a handyman special, you may need to price it accordingly and it may take longer to sell.
The Right Price. Setting an initial asking price that is too high may cause your house to sit on the market longer than it otherwise would. Either on your own or with help from a real estate agent, review selling prices of comparable properties in your neighborhood. Factors that determine a home’s worth include its size, its overall condition and the surrounding neighborhood. Buyers are likely to look at many properties before extending an offer, and it may be to your advantage to price your home equal to or slightly below comparable offerings if you want a quick sale.
Eye Appeal. Go beyond structural repairs and try to create as much eye appeal as possible. If you store large items, such as building materials or a boat, try to locate them elsewhere while the house is on the market. The illusion of extra space will appeal to many buyers. Clean out your garage, porches, basement, attic, closets, cabinets and other storage spaces and discard items you no longer use. Tidy up counters, mantels and display areas. Keep up with lawn mowing, snow shoveling, weeding, pruning and other landscaping chores. Consider purchasing potted flowers or other items that could improve the appearance of your deck or porch. If you lack the time for home maintenance, consider hiring a cleaning service or lawn maintenance company before your home is advertised for sale.
If the local real estate market is not in your favor, try capitalizing on areas that you can control, such as structural repairs, pricing and eye appeal, to move your house in a depressed market.
 
This article was prepared by Standard & Poor’s Financial Communications and is not intended to provide specific investment advice or recommendations for any individual. Consult your financial advisor or me if you have any questions.
 
Client Corner
We would like to congratulate Brian Callanan, son of our client Lorraine Callanan, for participating in a 40-mile ride in Vermont on Sunday, July 18. His personal fundraising goal of $1,000 for the Cystic Fibrosis Lifestyle Foundation was far exceeded. Brian’s goal in life has been “to help others learn to successfully manage life with CF, with exercise and recreation being a major part of that.”

Keep Punching is a quarterly newsletter for our clients. 

Click on the links below to read the news articles included in this issue.

August 2010
Estate Tax Circus
Some news on medical expenses in retirement
Good news for parents

If you would like to receive our newsletter and weekly market commentary via email, please call our office at 201-291-9000 or email your email address tokaren@randyneumann.com